10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended      June 30, 2012

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from  to 

Commission file number      001-14124

MILLER INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Tennessee	62-1566286
(State or other jurisdiction of incorporation or	(I.R.S. Employer Identification No.)
organization)
8503 Hilltop Drive
Ooltewah, Tennessee	37363
(Address of principal executive offices)	(Zip Code)

(423) 238-4171

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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 for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x                                           No o

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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes x                                           No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer o	Accelerated filer x
Non-accelerated filer o	Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o                                           No x

The number of shares outstanding of the registrant’s common stock, par value $.01 per share, as of August 3, 2012 was 11,067,431.

Index

PART I	FINANCIAL INFORMATION		Page Number
	Item 1.	Financial Statements
		Condensed Consolidated Balance Sheets – June 30, 2012 and December 31, 2011	2
		Condensed Consolidated Statements of Income for the Three and Six Months Ended June 30, 2012 and 2011	3
		Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2012 and 2011	4
		Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2012 and 2011	5
		Notes to Condensed Consolidated Financial Statements	6
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	14
	Item 4.	Controls and Procedures	15
PART II		OTHER INFORMATION
	Item 1.	Legal Proceedings	15
	Item 1A.	Risk Factors	15
	Item 6.	Exhibits	16
SIGNATURES			17

FORWARD-LOOKING STATEMENTS

Certain statements in this Form 10-Q, including but not limited to statements made in Part I, Item 2–”Management’s Discussion and Analysis of Financial Condition and Results of Operations,” may be deemed to be forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of words such as “may,” “will,” “should,” “could,” “continue,” “future,” “potential,” “believe,” “project,” “plan,” “intend,” “seek,” “estimate,” “predict,” “expect,” “anticipate” and similar expressions, or the negative of such words, or other comparable terminology. Forward-looking statements also include the assumptions underlying or relating to any of the foregoing statements. Such forward-looking statements are made based on our management’s beliefs as well as assumptions made by, and information currently available to, our management. These forward-looking statements are subject to a number of risks and uncertainties, including, economic and market conditions; the risks related to the general economic health of our customers; the success and timing of existing and additional export and governmental orders; our customers’ access to capital and credit to fund purchases, including the ability of our customers to secure floor plan financing; changes in fuel and other transportation costs; the cyclical nature of our industry; our dependence on outside suppliers of raw materials; changes in the cost of aluminum, steel and related raw materials; and those other risks referenced herein, including those risks referred to in Part II, Item 1A–”Risk Factors” and those risks discussed in our other filings with the Securities and Exchange Commission, including those risks discussed under the caption “Risk Factors” in our Annual Report on Form 10-K for fiscal 2011, which discussion is incorporated herein by this reference. Such factors are not exclusive. We do not undertake to update any forward-looking statement that may be made from time to time by, or on behalf of, our company.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

MILLER INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

	June 30, 2012 (Unaudited)			December 31, 2011
ASSETS
CURRENT ASSETS:
Cash and temporary investments	$	40,760		$	50,153
Accounts receivable, net of allowance for doubtful accounts of $1,652 and $1,691 at June 30, 2012 and December 31, 2011, respectively		67,347			61,085
Inventories		47,723			48,240
Prepaid expenses		2,417			2,219
Current deferred income taxes		5,093			5,144
Total current assets		163,340			166,841
PROPERTY, PLANT, AND EQUIPMENT, net		32,503			33,120
GOODWILL		11,619			11,619
OTHER ASSETS		265			262
	$	207,727		$	211,842
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Current portion of long-term obligations	$	---		$	5
Accounts payable		36,368			39,692
Accrued liabilities		15,429			17,384
Total current liabilities		51,797			57,081
LONG-TERM OBLIGATIONS, less current portion		---			---
DEFERRED INCOME TAX LIABILITIES		2,110			2,110
COMMITMENTS AND CONTINGENCIES (Notes 6 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, 11,067,331 and 11,000,119 outstanding at June 30, 2012 and December 31, 2011, respectively		111			110
Additional paid-in capital		147,748			147,004
Accumulated earnings		7,080			5,400
Accumulated other comprehensive income (loss)		(1,119	)		137
Total shareholders’ equity		153,820			152,651
	$	207,727		$	211,842

The accompanying notes are an integral part of these financial statements.

2

MILLER INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

	Three Months Ended June 30						Six Months Ended June 30
	2012			2011			2012			2011
NET SALES	$	87,346		$	97,566		$	182,303		$	206,491
COSTS AND EXPENSES:
Costs of operations		76,781			80,092			160,854			168,284
Selling, general and administrative expenses		7,204			7,697			14,206			15,846
Interest expense, net		214			214			431			360
Other (income) expense		(1,039	)		(9	)		(703	)		(9	)
Total costs and expenses		83,160			87,994			174,788			184,481
INCOME BEFORE INCOME TAXES		4,186			9,572			7,515			22,010
INCOME TAX PROVISION		1,640			3,796			2,959			8,790
NET INCOME	$	2,546		$	5,776		$	4,556		$	13,220
BASIC INCOME PER COMMON SHARE	$	0.23		$	0.49		$	0.41		$	1.12
DILUTED INCOME PER COMMON SHARE	$	0.23		$	0.47		$	0.40		$	1.08
CASH DIVIDENDS DECLARED PER COMMON SHARE	$	0.13		$	0.12		$	0.26		$	0.24
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic		11,062			11,884			11,046			11,823
Diluted		11,251			12,295			11,250			12,274

The accompanying notes are an integral part of these financial statements.

3

MILLER INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

	Three Months Ended June 30					Six Months Ended June 30
	2012			2011		2012			2011
Net income	$	2,546		$	5,776	$	4,556		$	13,220
Other comprehensive income:
Foreign currency translation adjustment		(1,554	)		808		(1,255	)		1,700
Total other comprehensive income (loss)		(1,554	)		808		(1,255	)		1,700
Total comprehensive income	$	992		$	6,584	$	3,301		$	14,920

The accompanying notes are an integral part of these financial statements.

4

MILLER INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended June 30
	2012			2011
OPERATING ACTIVITIES:
Net income	$	4,556		$	13,220
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		1,850			1,732
Provision for doubtful accounts		154			90
Stock-based compensation		200			200
Excess tax benefit from stock-based compensation		(119	)		(395	)
Issuance of non-employee director shares		75			100
Deferred income tax provision		49			443
Changes in operating assets and liabilities:
Accounts receivable		(6,552	)		(7,102	)
Inventories		(62	)		(10,363	)
Prepaid expenses		(214	)		1,459
Accounts payable		(3,069	)		3,905
Accrued liabilities		(1,621	)		5,700
Net cash flows from operating activities		(4,753	)		8,989
INVESTING ACTIVITIES:
Purchases of property, plant and equipment		(1,292	)		(926	)
Proceeds from sale of property, plant and equipment		1			989
Payments received on notes receivable		8			173
Net cash flows from investing activities		(1,283	)		236
FINANCING ACTIVITIES:
Payments on long-term obligations		(5	)		(37	)
Payments of cash dividends		(2,876	)		(2,844	)
Proceeds from stock option exercises		351			1,799
Excess tax benefit from stock-based compensation		119			395
Additions to deferred financing activities		(11	)		---
Payments for common stock repurchased		---			(1,098	)
Net cash flows from financing activities		(2,422	)		(1,785	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND TEMPORARY INVESTMENTS		(935	)		1,157
NET CHANGE IN CASH AND TEMPORARY INVESTMENTS		(9,393	)		8,597
CASH AND TEMPORARY INVESTMENTS, beginning of period		50,153			46,334
CASH AND TEMPORARY INVESTMENTS, end of period	$	40,760		$	54,931
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash payments for interest	$	545		$	210
Cash payments for income taxes, net of refunds	$	3,214		$	2,004

The accompanying notes are an integral part of these financial statements.

5

MILLER INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. BASIS OF PRESENTATION

The condensed consolidated financial statements of Miller Industries, Inc. and subsidiaries (the “Company”) included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. Nevertheless, the Company believes that the disclosures are adequate to make the financial information presented not misleading. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, to present fairly the Company’s financial position, results of operations and cash flows at the dates and for the periods presented. Cost of goods sold for interim periods for certain entities is determined based on estimated gross profit rates. Interim results of operations are not necessarily indicative of results to be expected for the fiscal year. These condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.  The consolidated financial statements include accounts of certain subsidiaries whose fiscal closing dates differ from December 31st by 31 days (or less) to facilitate timely reporting.  Certain prior year amounts have been reclassified to conform to current year presentation, with no impact on previously reported shareholders’ equity. The Company evaluated subsequent events through the date the financial statements were issued.

2. BASIC AND DILUTED INCOME PER SHARE

Basic income per share is computed by dividing net income by the weighted average number of common shares outstanding. Diluted income per share is calculated by dividing net income by the weighted average number of common and potential dilutive common shares outstanding. Diluted income per share takes into consideration the assumed exercise of outstanding stock options resulting in approximately 189,000 and 411,000 potential dilutive common shares for the three months ended June 30, 2012 and 2011, respectively, and 204,000 and 451,000 for the six months ended June 30, 2012 and 2011, respectively. For the three and six months ended June 30, 2012 and 2011, none of the outstanding stock options would have been anti-dilutive.

3. INVENTORIES

Inventory costs include materials, labor and factory overhead. Inventories are stated at the lower of cost or market (net realizable value), determined on a first-in, first-out basis. Appropriate consideration is given to obsolescence, valuation and other factors in determining net realizable value. Revisions of these estimates could result in the need for adjustments. Inventories, net of reserves, at June 30, 2012 and December 31, 2011 consisted of the following (in thousands):

	June 30, 2012		December 31, 2011
Chassis	$	12,457	$	12,807
Raw materials		17,739		18,725
Work in process		7,829		8,426
Finished goods		9,698		8,282
	$	47,723	$	48,240

4.           LONG-LIVED ASSETS

The Company periodically reviews the carrying amount of its long-lived assets to determine if those assets may be recoverable based upon the future operating cash flows expected to be generated by those assets. Management believes that its long-lived assets are appropriately valued.

5. GOODWILL

Goodwill consists of the excess of cost of acquired entities over the sum of the amounts assigned to identifiable assets acquired less liabilities assumed. Goodwill is not amortized. However, the Company evaluates the carrying value of goodwill for impairment at least annually or if an event or circumstance occurs that would indicate that the carrying amount had been impaired. The Company reviews goodwill for impairment utilizing a qualitative assessment or a two-step process. If we choose to perform a qualitative analysis of goodwill and determine that the fair value more likely than not exceeds the carrying value, no further testing is needed.  If we choose the two-step approach, the first step identifies potential impairment by comparing the fair value of the reporting unit with its carrying value. If the fair value exceeds the carrying value the second step is not necessary.  If the carrying value is more than the fair value, the second step of testing is performed to compare the fair value of the goodwill with its carrying value.  An impairment loss would be recognized to the extent that the carrying value of the goodwill exceeds its fair value.

6

6. LONG-TERM OBLIGATIONS

At June 30, 2012, the Company had no long-term obligations.  At December 31, 2011, the Company had long-term obligations of $5,000, which consisted of equipment and other notes payable.  Certain equipment was pledged as collateral under the Company’s equipment notes payable.

Credit Facility and Other Obligations

Credit Facility

On April 6, 2010, the Company entered into a Loan Agreement with First Tennessee Bank National Association for a $20.0 million unsecured revolving credit facility and on December 21, 2011 the credit facility was renewed and our unsecured revolving credit facility was increased to $25.0 million (the “Credit Facility”). The Credit Facility contains customary representations and warranties, events of default, and financial, affirmative and negative covenants for loan agreements of this kind. Covenants under the Credit Facility restrict the payment of cash dividends if the Company would be in violation of the minimum tangible net worth test or the leverage ratio test in the current loan agreement as a result of the dividends, among various other restrictions.

In the absence of a default, all borrowings under the Credit Facility bear interest at the LIBOR Rate plus 1.50% per annum. The Company will pay a non-usage fee under the current loan agreement in an annual amount between 0.15% and 0.35% of the unused amount of the Credit Facility, which fee shall be paid quarterly. The Credit Facility is scheduled to expire on March 31, 2014.

At June 30, 2012 and December 31, 2011, the Company had no outstanding borrowings under the Credit Facility.

Interest Rate Risk

Changes in interest rates affect the interest paid on indebtedness under the Credit Facility because outstanding amounts of indebtedness under the Credit Facility are subject to variable interest rates. Under the Credit Facility, the non-default rate of interest was equal to the LIBOR Market Index Rate plus 1.50% per annum (for a rate of interest of 1.75% at June 30, 2012). Because there were no amounts outstanding under the Credit Facility, a one percent change in the interest rate on our variable-rate debt would not have a material impact on our financial position, results of operations or cash flows for the three-month period ended June 30, 2012.

7. STOCK-BASED COMPENSATION

Stock compensation expense was $100,000 for each of the three month periods ended June 30, 2012 and 2011 and $200,000 for each of the six months ended June 30, 2012 and 2011.  Stock compensation expenses are included in selling, general and administrative expenses in the accompanying consolidated statements of income. The Company did not issue any stock options during the three and six months ended June 30, 2012. As of June 30, 2012, the Company had $133,000 of unrecognized compensation expense related to stock options which will be expensed during the remainder of 2012. For additional disclosures related to the Company’s stock-based compensation refer to Notes 2 and 4 of the Notes to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

During the three months ended June 30, 2012 and 2011, options were exercised for the purchase of 9,800 shares of common stock at a weighted-average exercise price of $5.49 and 193,717 shares of common stock at a weighted-average exercise price of $6.13, respectively.  During the six months ended June 30, 2012 and 2011, options were exercised for the purchase of 62,475 shares of common stock at a weighted-average exercise price of $5.61 and 298,652 shares of common stock at a weighted-average exercise price of $6.02, respectively.

8. COMMITMENTS AND CONTINGENCIES

Commitments

The Company has entered into arrangements with third-party lenders where it has agreed, in the event of default by a customer, to repurchase from the third-party lender Company products repossessed from the customer. These arrangements are typically subject to a maximum repurchase amount. The maximum amount of collateral that the Company could be required to purchase was approximately $24.8 million at June 30, 2012, and $18.1 million at December 31, 2011. However, the Company’s risk under these arrangements is mitigated by the value of the products that would be repurchased as part of the transaction. The Company considered the fair value at inception of its liability under these arrangements and concluded that the liability associated with these potential repurchase obligations is not material.

At June 30, 2012, the Company had commitments of approximately $1.1 million for construction and acquisition of property, plant and equipment.

7

Contingencies

The Company is, from time to time, a party to litigation arising in the normal course of its business. Litigation is subject to various inherent uncertainties, and it is possible that some of these matters could be resolved unfavorably to the Company, which could result in substantial damages against the Company. The Company has established accruals for matters that are probable and reasonably estimable and maintains product liability and other insurance that management believes to be adequate. Management believes that any liability that may ultimately result from the resolution of these matters in excess of available insurance coverage and accruals will not have a material adverse effect on the consolidated financial position or results of operations of the Company.

9. INCOME TAXES

At June 30, 2012 and December 31, 2011, the Company had no unrecognized income tax positions recorded. The Company does not expect its unrecognized tax positions to change significantly in the next twelve months. If unrecognized tax positions existed, the interest and penalties related to the unrecognized tax positions would be recorded as income tax expense in the consolidated statements of income.

The Company is subject to United States federal income taxes, as well as income taxes in various states and foreign jurisdictions. The Company’s tax years 2008 through 2010 remain open to examination for U.S. federal income taxes. With few exceptions, the Company is no longer subject to state or non-U.S. income tax examinations prior to 2008.

10. SHAREHOLDERS EQUITY

Dividends

On March 7, 2011, the Company’s board of directors declared an annual cash dividend of $0.12 per share. The dividend of $1,415,000 was paid on March 24, 2011 to shareholders of record as of March 17, 2011.

On May 10, 2011, the Company’s board of directors approved a dividend policy to consider and pay quarterly cash dividends on its common stock subject to the Company’s ability to satisfy all applicable statutory requirements and the Company’s current financial strength, replacing the previous policy of paying annual cash dividends. In conjunction with this new policy the board of directors declared the first such quarterly cash dividend of $0.12 per share. The dividend of $1,429,206 was paid on May 31, 2011 to shareholders of record as of May 23, 2011.

On August 5, 2011, the Company’s board of directors declared a quarterly cash dividend of $0.12 per share.  The dividend of $1,364,963 was paid on August 26, 2011 to shareholders of record as of August 19, 2011.

On November 7, 2011, the Company’s board of directors declared a quarterly cash dividend of $0.12 per share.  The dividend of $1,336,687 was paid on December 19, 2011 to shareholders of record as of December 5, 2011.

On March 5, 2012, the Company’s board of directors declared a quarterly cash dividend of $0.13 per share.  The dividend of $1,437,200 was paid on March 26, 2012 to shareholders of record as of March 19, 2012.

On May 7, 2012, the Company’s board of directors declared a quarterly cash dividend of $0.13 per share.  The dividend of $1,438,753 was paid on June 25, 2012 to shareholders of record as of June 18, 2012.

Stock Repurchase Program

In May 2011, the Company’s board of directors authorized the repurchase of up to $20.0 million of shares of its common stock. The repurchase program was completed in December 2011.  A total of 1,184,200 shares were repurchased for $20.0 million during 2011.

8

11. GEOGRAPHIC INFORMATION

Net sales and long-lived assets (property, plant and equipment and goodwill and intangible assets) by region were as follows (revenue is attributed to regions based on the locations of customers) (in thousands):

	For the Three Months Ended June 30						For the Six Months Ended June 30
	2012			2011			2012			2011
Net Sales:
North America		$	71,418		$	81,841		$	150,267		$	178,201
Foreign			15,928			15,725			32,036			28,290
		$	87,346		$	97,566		$	182,303		$	206,491

	June 30, 2012		December 31, 2011
Long Lived Assets:
North America	$	41,237	$	42,147
Foreign		2,885		2,592
	$	44,122	$	44,739

12. CUSTOMER INFORMATION

No single customer accounted for 10% or more of consolidated net sales for the three and six months ended June 30, 2012. The Company’s largest customer accounted for 22.3% of consolidated net sales for the three months ended June 30, 2011, and 32.5% of consolidated net sales for the six months ended June 30, 2011.  This customer represented 7.2% of accounts receivable at December 31, 2011.

13.  FAIR VALUE OF FINANCIAL INSTRUMENTS

For assets and liabilities measured at fair value on a recurring and nonrecurring basis, a three-level hierarchy of measurements based upon observable and unobservable inputs is used to arrive at fair value. Observable inputs are developed based on market data obtained from independent sources, while unobservable inputs reflect our assumptions about valuation based on the best information available in the circumstances. Depending on the inputs, we classify each fair value measurement as follows:

Level 1—based upon quoted prices for identical instruments in active markets,

Level 2—based upon quoted prices for similar instruments, prices for identical or similar instruments in markets that are not active, or model-derived valuations, all of whose significant inputs are observable, and

Level 3—based upon one or more significant unobservable inputs.

The carrying values of cash and temporary investments, accounts receivable, accounts payable and accrued liabilities are reasonable estimates of their fair values because of the short maturity of these financial instruments.  The carrying values of long-term obligations are reasonable estimates of their fair values based on the rates available for obligations with similar terms and maturities.

The fair value of derivative assets and liabilities are measured assuming that the unit of account is an individual derivative transaction and that each derivative could be sold or transferred on a stand-alone basis. We classify within Level 2 our forward foreign currency exchange contracts based upon quoted prices for similar instruments that are actively traded.  For more information regarding derivatives, see Note 14, Derivative Financial Instruments.

9

The following table presents the financial instruments measured at fair value on a recurring basis:

	June 30, 2012
	Level 1		Level 2		Level 3		Total
(in thousands)
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	3	$	—	$	3
Total assets	$	—	$	3	$	—	$	3
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total liabilities	$	—	$	—	$	—	$	—

	December 31, 2011
	Level 1		Level 2		Level 3		Total
(in thousands)
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	43	$	—	$	43
Total assets	$	—	$	43	$	—	$	43
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total liabilities	$	—	$	—	$	—	$	—

14.           DERIVATIVE FINANCIAL INSTRUMENTS

The Company periodically enters into certain forward foreign currency exchange contracts that are designed to mitigate foreign currency risk.  These contracts are not designated as hedging instruments.  At December 31, 2011, the Company had foreign currency exchange contracts (Euros to Dollars) with notional values aggregating $0.6 million maturing in April 2012.  Additionally, at June 30, 2012, the Company had contracts with notional values aggregating $6.3 million maturing in the fourth quarter of 2013.  The fair value of the contracts is presented in accounts receivable in our consolidated balance sheet.  Changes in the fair value of the foreign currency exchange contracts are recognized each period in other income (expense) in our consolidated statement of income.  A gain of $288,000 was recognized for the three months ended June 30, 2012 and a loss of $39,000 was recognized for the six months ended June 30, 2012.

15. RECENT ACCOUNTING PRONOUNCEMENTS

Recently Adopted Standards

In June 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2011-05, “Presentation of Comprehensive Income” (ASU 2011-05). This standard amends guidance on the presentation of other comprehensive income in financial statements to improve the comparability, consistency and transparency and to increase the prominence of items that are recorded in other comprehensive income. Under ASU 2011-05, an entity has the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The provisions under ASU 2011-05 were effective for fiscal years beginning after December 15, 2011.  We elected to adopt the two separate but consecutive statement presentation, and the adoption of this standard did not have a significant impact on our consolidated financial statements.

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In September 2011, the FASB issued ASU 2011-08, “Testing Goodwill for Impairment”, which simplifies how an entity tests for goodwill impairment.   After assessment of certain qualitative factors, if it is determined to be more likely than not that the fair value of a reporting unit is less than its carrying amount, entities must perform the quantitative analysis of the goodwill impairment test.  Otherwise, the quantitative test(s) become optional.  The provisions under ASU 2011-08 were effective for annual and interim goodwill impairment testing for fiscal years beginning after December 15, 2011.  The adoption of this standard did not have an impact on our consolidated financial statements.

Recently Issued Standards

There are no recently issued accounting standards for which the Company expects a material impact on our financial statements.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Executive Overview

Miller Industries, Inc. is the world’s largest manufacturer of vehicle towing and recovery equipment, with domestic manufacturing subsidiaries in Tennessee and Pennsylvania, and foreign manufacturing subsidiaries in France and the United Kingdom. We offer a broad range of equipment to meet our customers’ design, capacity and cost requirements under our Century®, Vulcan®, Challenger®, Holmes®, Champion®, Chevron™, Eagle®, Titan®, Jige™ and Boniface™ brand names. In this Item 2 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the words “Miller Industries,” “the Company,” “we,” “our,” “ours” and “us” refer to Miller Industries, Inc. and its subsidiaries or any of them.

Our management focuses on a variety of key indicators to monitor our overall operating and financial performance. These indicators include measurements of revenue, operating income, gross margin, earnings per share, capital expenditures and cash flow.

We derive revenues primarily from product sales made through our network of domestic and foreign independent distributors. Our revenues are sensitive to a variety of factors including general economic conditions as well as demand for, and price of, our products, our technological competitiveness, our reputation for providing quality products and reliable service, competition within our industry, and the cost of raw materials (including aluminum, steel and petroleum-related products).

Our industry is cyclical in nature and in recent years the overall demand for our products and our resulting revenues continued to be negatively affected by:

● wavering levels of consumer confidence;

● volatility and disruption in domestic and international capital and credit markets and the resulting decrease in the availability of financing, including floor plan financing, for our customers and towing operators;

● significant periodic increases in fuel and insurance costs and their negative effect on the ability of our customers to purchase towing and related equipment;

● the overall effects of the global economic downturn; and

● currently, the slow economic recovery.

We remain concerned about the continuing effects of these factors on the towing and recovery industry and have continued certain steps implemented in 2009 to lower costs in response to these uncertainties. These steps included headcount reductions for certain non-production personnel and reductions in certain administrative expenses. Due to increased demand for our domestic products and higher production of follow-on government orders through prime contracts during 2010 and 2011, production hours at all facilities were restored and reduced work weeks and furloughs were eliminated. We continue to monitor our overall cost structure to see that it remains in line with business conditions.

In addition, we have been and will continue to be affected by changes in the prices that we pay for raw materials, particularly aluminum, steel, petroleum-related products and other raw materials, which represent a substantial part of our total costs of operations. In the past, as we have determined necessary, we have implemented price increases to offset these higher costs. We also developed alternatives to some of the components used in our production process that incorporate these raw materials, and our suppliers have implemented these alternatives in the production of our component parts. We continue to monitor raw material prices and availability in order to more favorably position the Company in this dynamic market.

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During the second half of 2008, we began to secure follow-on governmental orders through prime contractors for which production was completed during the fourth quarter of 2011. Through these follow-on orders, along with continued performance in the governmental and international marketplace, we were able to somewhat offset significantly lower demand from our commercial customers which began in the second half of 2008. Although demand from our commercial customers has not recovered to pre-2008 levels, we have seen demand from these customers pick up somewhat through the second quarter of 2012.  At this time we do not expect to receive additional follow-on government-related orders in the near term. We continue to work to secure additional domestic and foreign governmental orders, but we cannot predict the success or timing of any such efforts.

There were no borrowings under the credit facility at June 30, 2012.

Critical Accounting Policies

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require us to make estimates. Certain accounting policies are deemed “critical,” as they require management’s highest degree of judgment, estimates and assumptions. A discussion of critical accounting policies, the judgments and uncertainties affecting their application and the likelihood that materially different amounts would be reported under different conditions or using different assumptions follows:

Accounts receivable

We extend credit to customers in the normal course of business. Collections from customers are continuously monitored and an allowance for doubtful accounts is maintained based on historical experience and any specific customer collection issues. While such bad debt expenses have historically been within expectations and the allowance established, there can be no assurance that we will continue to experience the same credit loss rates as in the past.

Inventory

Inventory costs include materials, labor and factory overhead. Inventories are stated at the lower of cost or market (net realizable value), determined on a first-in, first-out basis. Appropriate consideration is given to obsolescence, valuation and other factors in determining net realizable value. Revisions of these estimates could result in the need for adjustments.

Long-lived assets

Long-lived assets are reviewed for impairment whenever events or circumstances indicate that the carrying amount of these assets may not be fully recoverable. When a determination has been made that the carrying amount of long-lived assets may not be fully recovered, the amount of impairment is measured by comparing an asset’s estimated fair value to its carrying value. The determination of fair value is based on projected future cash flows discounted at a rate determined by management or, if available, independent appraisals or sales price negotiations. The estimation of fair value includes significant judgment regarding assumptions of revenue, operating costs, interest rates, property and equipment additions, and industry competition and general economic and business conditions among other factors. We believe that these estimates are reasonable, however, changes in any of these factors could affect these evaluations. Based on these estimations, we believe that our long-lived assets are appropriately valued.

Goodwill

Goodwill is tested for impairment annually or if an event or circumstance occurs that would more likely than not reduce the fair value of the reporting unit below the carrying amount.  We review goodwill for impairment utilizing a qualitative assessment or a two-step approach.  If we choose to perform a qualitative analysis of goodwill and determine that the fair value more likely than not exceeds the carrying value, no further testing is needed.  If we choose the two-step approach, the first step identifies potential impairment by comparing the fair value of the reporting unit with its carrying value. If the fair value exceeds the carrying value the second step is not necessary. If the carrying value is more than the fair value, the second step of testing is performed to compare the fair value of the goodwill with its carrying value. An impairment loss would be recognized to the extent that the carrying value of the goodwill exceeds its fair value.  We cannot predict the occurrence of certain events or changes in circumstances that might adversely affect the carrying value of goodwill. Such events might include, but are not limited to, the impact of the economic environment or a material change in a relationship with significant customers.

Warranty reserves

We estimate expense for product warranty claims at the time products are sold. These estimates are established using historical information about the nature, frequency, and average cost of warranty claims. We review trends of warranty claims and take actions to improve product quality and minimize warranty claims. We believe the warranty reserve is adequate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the accrual.

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Income taxes

We recognize deferred tax assets and liabilities based on differences between the financial statement carrying amounts and the tax bases of assets and liabilities. If unrecognized tax positions exist, we record interest and penalties related to the unrecognized tax positions as income tax expense in our consolidated statement of income.

Revenues

Under our accounting policies, revenues are recorded when the risk of ownership for products has transferred to independent distributors or other customers, which generally occurs on shipment. From time to time, revenue is recognized under a bill and hold arrangement. Recognition of revenue on bill and hold arrangements occurs when risk of ownership has passed to the customer, a fixed written commitment has been provided by the customer, the goods are complete and ready for shipment, the goods are segregated from inventory, no performance obligation remains, and a schedule for delivery has been established. While we manufacture only the bodies of wreckers, which are installed on truck chassis manufactured by third parties, we frequently purchase the truck chassis for resale to our customers. Sales of company-purchased truck chassis are included in net sales. Margins are substantially lower on completed recovery vehicles containing company-purchased chassis because the markup over the cost of the chassis is nominal.

Foreign Currency Translation

The functional currency for our foreign operations is the applicable local currency. The translation from the applicable foreign currencies to U.S. dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date, historical rates for equity and the weighted average exchange rate during the period for revenue and expense accounts. Foreign currency translation adjustments are included in shareholders’ equity. Intercompany debt denominated in a currency other than the functional currency, is remeasured into the functional currency. Gains and losses resulting from foreign currency transactions are included in other income and expense in our consolidated statements of income.

Results of Operations–Three Months Ended June 30, 2012 Compared to Three Months Ended June 30, 2011

Net sales for the three months ended June 30, 2012 decreased 10.5% to $87.3 million from $97.6 million for the comparable period in 2011. The decrease in revenue was attributable to the absence of revenues in 2012 from follow-on orders from a prime contractor for government-related sales as discussed above offset partially by increased activity from our commercial customers.

Costs of operations for the three months ended June 30, 2012 decreased 4.1% to $76.8 million from $80.1 million for the comparable period in 2011, which was attributable to the decrease in governmental sales described above. Overall, costs of operations increased as a percentage of sales from 82.1% to 87.9%, primarily due to product mix during the quarter consisting of a higher percentage of lower margin chassis sales.

Selling, general, and administrative expenses for the three months ended June 30, 2012 decreased to $7.2 million from $7.7 million for the three months ended June 30, 2011. This decrease was attributable to the lower sales levels during the period, as well as decreased sales commissions and incentives.  As a percentage of sales, selling, general, and administrative expenses increased slightly to 8.3% for the three months ended June 30, 2012 from 7.9% for the three months ended June 30, 2011 due to the fixed nature of certain of these expenses.

Total interest expense remained constant at $0.2 million for the three months ended June 30, 2012 and 2011.

Other income and expense relate to foreign currency transaction gains and losses. During the three months ended June 30, 2012, the gain was $1.0 million compared to a $9,000 gain for the prior year period.

The provision for income taxes for the three months ended June 30, 2012 and 2011 reflects a combined effective U.S. federal, state and foreign tax rate of 39.2% and 39.7%, respectively.

Results of operations– Six Months Ended June 30, 2012 Compared to Six Months Ended June 30, 2011

Net sales for the six months ended June 30, 2012 decreased 11.7% to $182.3 million from $206.5 million for the comparable period in 2011. The decrease in revenue was attributable to the absence of revenues in 2012 from follow-on orders from a prime contractor for government-related sales as discussed above offset partially by increased activity from our commercial customers.

Costs of operations for the six months ended June 30, 2012 decreased 4.4% to $160.9 million from $168.3 million for the comparable period in 2011, which was attributable to the decrease in governmental sales described above. Overall, costs of operations increased as a percentage of sales from 81.5% to 88.2%, primarily due to product mix during the period consisting of a higher percentage of lower margin chassis sales.

Selling, general, and administrative expenses for the six months ended June 30, 2012 decreased to $14.2 million from $15.8 million for the six months ended June 30, 2011. This decrease was attributable to the lower sales levels during the period, as well as decreased sales commissions and incentives.  As a percentage of sales, selling, general, and administrative expenses increased slightly to 7.8% for the six months ended June 30, 2012 from 7.7% for the six months ended June 30, 2011 due to the fixed nature of certain of these expenses.

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Total interest expense increased to $0.4 million from $0.3 million for the six months ended June 30, 2012 as compared to the comparable period in 2011.  Increases in interest expense were primarily from higher floor plan interest resulting from higher domestic commercial sales levels during the period.

Other income and expense relate to foreign currency transaction gains and losses. During the six months ended June 30, 2012, the gain was $0.7 million compared to a $9,000 gain for the prior year period.

The provision for income taxes for the six months ended June 30, 2012 and 2011 reflects a combined effective U.S. federal, state and foreign tax rate of 39.4% and 39.9%, respectively

Liquidity and Capital Resources

Cash used in operating activities was $4.8 million for the six months ended June 30, 2012, compared to $9.0 million provided by operating activities for the comparable period in 2011.  The cash used in operating activities for the 2012 period is attributable to lower net income and increases in accounts receivable and prepaid expenses and decreases in accrued liabilities and accounts payable.  These increases in accounts receivable are attributable to the increased activity from our commercial customers including increased chassis purchases and sales.

Cash used in investing activities was $1.3 million for the six months ended June 30, 2012 compared to cash provided by investing activities of $0.2 million for the comparable period in 2011. The cash used in investing activities for the first six months of 2012 was primarily for the purchase of property, plant and equipment.

Cash used in financing activities was $2.4 million for the six months ended June 30, 2012, compared to $1.8 million for the comparable period in 2011. The cash used in financing activities for the 2012 period was primarily to pay cash dividends, partially offset by proceeds from the exercise of stock options.

As of June 30, 2012, we had cash and cash equivalents of $40.8 million, exclusive of unused availability under our credit facility. Our primary cash requirements include working capital, capital expenditures, the funding of any declared cash dividends and interest and principal payments on indebtedness, if any, under our credit facility. At June 30, 2012, the Company had commitments of approximately $1.1 million for construction and acquisition of property and equipment. We expect our primary sources of cash to be cash flow from operations and cash and cash equivalents on hand at June 30, 2012, with borrowings under our credit facility being available if needed. We expect these sources to be sufficient to satisfy our cash needs during 2012 and for the next several years. However, our ability to satisfy our cash needs will substantially depend upon a number of factors including our future operating performance, taking into account the economic and other factors discussed above and elsewhere in this Quarterly Report, as well as financial, business and other factors, many of which are beyond our control.

Credit Facilities and Other Obligations

Credit Facility

On April 6, 2010, the Company entered into a Loan Agreement with First Tennessee Bank National Association for a $20.0 million unsecured revolving credit facility and on December 21, 2011 the credit facility was renewed and our unsecured revolving credit facility was increased to $25.0 million (the “Credit Facility”). The Credit Facility contains customary representations and warranties, events of default, and financial, affirmative and negative covenants for loan agreements of this kind. Covenants under the Credit Facility restrict the payment of cash dividends if the Company would be in violation of the minimum tangible net worth test or the leverage ratio test in the current loan agreement as a result of the dividends, among various other restrictions.

In the absence of a default, all borrowings under the Credit Facility bear interest at the LIBOR Rate plus 1.50% per annum. The Company will pay a non-usage fee under the current loan agreement in an amount between 0.15% and 0.35% of the unused amount of the Credit Facility, which fee shall be paid quarterly. The Credit Facility is scheduled to expire on March 31, 2014.

At June 30, 2012 and December 31, 2011, the Company had no outstanding borrowings under the Credit Facility.

Other Long-Term Obligations

At June 30, 2012, we had approximately $0.9 million in non-cancelable operating lease obligations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

In the normal course of our business, we are exposed to market risk from changes in interest rates and foreign currency exchange rates that could impact our results of operations and financial position.

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Interest Rate Risk

Changes in interest rates affect the interest paid on indebtedness under our Credit Facility because the outstanding amounts of indebtedness under our Credit Facility are subject to variable interest rates. Under our Credit Facility, the non-default rate of interest was equal to the LIBOR Market Index Rate plus 1.50% per annum (for a rate of interest of 1.75% at June 30, 2012). Because there were no amounts outstanding under the Credit Facility, a one percent change in the interest rate on our variable-rate debt would not have materially impacted our financial position, results of operations or cash flows for the quarter ended June 30, 2012.

Foreign Currency Exchange Rate Risk

We are subject to risk arising from changes in foreign currency exchange rates related to our international operations in Europe. We manage our exposure to our foreign currency exchange rate risk through our regular operating and financing activities. Additionally, from time to time, we enter into certain forward foreign currency exchange contracts that are not designated as a hedging instrument in order to mitigate our foreign currency exchange risk.  Because we report in U.S. dollars on a consolidated basis, foreign currency exchange fluctuations could have a translation impact on our financial position. At June 30, 2012, we recognized a $1.3 million decrease in our foreign currency translation adjustment account compared with December 31, 2011 because of fluctuations of the U.S. dollar against certain foreign currencies. During the three months ended June 30, 2012 and 2011, the impact of foreign currency exchange rate changes on our results of operations and cash flows was a gain of $1.0 million and a gain of $9,000, respectively.  For the six months ended June 30, 2012 and 2011, the impact of foreign currency exchange rate changes on the results of operations and cash flows was a gain of $0.7 million and a gain of $9,000, respectively.

ITEM 4. CONTROLS AND PROCEDURES

Within 90 days prior to the filing date of this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a14(c) under the Securities Exchange Act of 1934. Based upon this evaluation, our CEO and CFO have concluded that the disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.

There were no significant changes in our internal controls or in other factors that could significantly affect internal controls subsequent to the date of this evaluation.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are, from time to time, a party to litigation arising in the normal course of our business. Litigation is subject to various inherent uncertainties, and it is possible that some of these matters could be resolved unfavorably to us, which could result in substantial damages against us. We have established accruals for matters that are probable and reasonably estimable and maintain product liability and other insurance that management believes to be adequate. Management believes that any liability that may ultimately result from the resolution of these matters in excess of available insurance coverage and accruals will not have a material adverse effect on our consolidated financial position or results of operations.

ITEM 1A.   RISK FACTORS

There have been no material changes to the Risk Factors included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

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ITEM 6. EXHIBITS

	Description	Incorporated by Reference to Registration File Number	Form or Report	Date of Report	Exhibit Number in Report
31.1	Certification Pursuant to Rules 13a-14(a)/15d- 14(a) by Chief Executive Officer*
31.2	Certification Pursuant to Rules 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 Chief Executive Officer*
32.2	Certification Pursuant to Section 1350 of Chapter 63 of Title 18 of United States Code by Chief Financial Officer*
101	The following information from the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2012 formatted in Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets – June 30, 2012 and December 31, 2011; (ii) Condensed Consolidated Statements of Income for the Three and Six Months Ended June 30, 2012 and 2011; (iii) Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2012 and 2011; (iv) Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2012 and 2011; and (v) Notes to Condensed Consolidated Financial Statements*
	*       Filed herewith

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Miller Industries, Inc. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

MILLER INDUSTRIES, INC.
By:	/s/ J. Vincent Mish
	J. Vincent Mish
	Executive Vice President and Chief Financial Officer

Date: August 8, 2012

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EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Jeffrey I. Badgley, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Miller Industries, Inc.

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2012

/s/ Jeffrey I. Badgley

Jeffrey I. Badgley

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, J. Vincent Mish, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Miller Industries, Inc.

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2012

/s/ J. Vincent Mish

J. Vincent Mish

Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

I, Jeffrey I. Badgley, President and Chief Executive Officer of Miller Industries, Inc. (the “Company”), certify, pursuant to 18 U.S.C. § 1350 as adopted by § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Quarterly Report on Form 10-Q of the Company for the quarterly period ended June 30, 2012 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: August 8, 2012

/s/ Jeffery I. Badgley

Jeffrey I. Badgley

Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

I, J. Vincent Mish, Executive Vice President and Chief Financial Officer of Miller Industries, Inc. (the “Company”), certify, pursuant to 18 U.S.C. § 1350 as adopted by § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Quarterly Report on Form 10-Q of the Company for the quarterly period ended June 30, 2012 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: August 8, 2012

/s/ J. Vincent Mish

J. Vincent Mish

Executive Vice President and Chief Financial Officer

XML

GEOGRAPHIC INFORMATION (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Net Sales:
North America	$ 71,418	$ 81,841	$ 150,267	$ 178,201
Foreign	15,928	15,725	32,036	28,290
Net Sales, Total	87,346	97,566	182,303	206,491
Long Lived Assets:
North America	41,237		41,237		42,147
Foreign	2,885		2,885		2,592
Long Lived Assets Total	$ 44,122		$ 44,122		$ 44,739

XML

BASIC AND DILUTED INCOME PER SHARE (Detail Textuals)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Earnings Per Share [Abstract]
Potential dilutive common shares	189,000	411,000	204,000	451,000
Anti-dilutive outstanding stock options

XML

INVENTORIES

6 Months Ended

Jun. 30, 2012

Inventory Disclosure [Abstract]

INVENTORIES

3. INVENTORIES

Inventory costs include materials, labor and factory overhead. Inventories are stated at the lower of cost or market (net realizable value), determined on a first-in, first-out basis. Appropriate consideration is given to obsolescence, valuation and other factors in determining net realizable value. Revisions of these estimates could result in the need for adjustments. Inventories, net of reserves, at June 30, 2012 and December 31, 2011 consisted of the following (in thousands):

	June 30, 2012		December 31, 2011
Chassis	$	12,457	$	12,807
Raw materials		17,739		18,725
Work in process		7,829		8,426
Finished goods		9,698		8,282
	$	47,723	$	48,240

XML

STOCK-BASED COMPENSATION (Detail Textuals 1) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]
Options exercised for the purchase of common stock	9,800	193,717	62,475	298,652
Weighted-average exercise price	$ 5.49	$ 6.13	$ 5.61	$ 6.02

XML

STOCK-BASED COMPENSATION (Detail Textuals) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized compensation expense	$ 133,000		$ 133,000
Selling, General and Administrative Expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock compensation expense	$ 100,000	$ 100,000	$ 200,000	$ 200,000

XML

COMMITMENTS AND CONTINGENCIES (Detail Textuals) (USD $) In Millions, unless otherwise specified			6 Months Ended
	Jun. 30, 2012	Dec. 31, 2011	Jun. 30, 2012 Capital Addition Purchase Commitments
Long-term Purchase Commitment [Line Items]
Maximum repurchase collateral amount	$ 24.8	$ 18.1
Commitment for construction and acquisiton of property, plant and equipment			$ 1.1

XML

INCOME TAXES (Detail Textuals) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Income Tax Disclosure [Abstract]
Unrecognized income tax positions

XML

BASIC AND DILUTED INCOME PER SHARE

6 Months Ended

Jun. 30, 2012

Earnings Per Share [Abstract]

BASIC AND DILUTED INCOME PER SHARE

2. BASIC AND DILUTED INCOME PER SHARE

Basic income per share is computed by dividing net income by the weighted average number of common shares outstanding. Diluted income per share is calculated by dividing net income by the weighted average number of common and potential dilutive common shares outstanding. Diluted income per share takes into consideration the assumed exercise of outstanding stock options resulting in approximately 189,000 and 411,000 potential dilutive common shares for the three months ended June 30, 2012 and 2011, respectively, and 204,000 and 451,000 for the six months ended June 30, 2012 and 2011, respectively. For the three and six months ended June 30, 2012 and 2011, none of the outstanding stock options would have been anti-dilutive.

XML

SHAREHOLDERS EQUITY (Detail Textuals) (USD $)	1 Months Ended	0 Months Ended		1 Months Ended	0 Months Ended			1 Months Ended	0 Months Ended		1 Months Ended			3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 18, 2012	May 07, 2012	Mar. 05, 2012	Mar. 19, 2012	Dec. 05, 2011	Nov. 07, 2011	Aug. 05, 2011	Aug. 19, 2011	May 10, 2011	Mar. 07, 2011	May 23, 2011	May 31, 2011	Mar. 17, 2011	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Stockholders' Equity Note [Abstract]
Annual cash dividend declared (per common share)		$ 0.13	$ 0.13			$ 0.12	$ 0.12		$ 0.12	$ 0.12				$ 0.13	$ 0.12	$ 0.26	$ 0.24
Dividend paid to shareholders	$ 1,438,753			$ 1,437,200	$ 1,336,687			$ 1,364,963			$ 1,429,206		$ 1,415,000
Amount of shares authorized to repurchase												20,000,000
Number of shares purchased under repurchase program (in shares)																		1,184,200
Amount of shares purchased under repurchase program																		$ 20,000,000

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CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
CURRENT ASSETS:
Cash and temporary investments	$ 40,760	$ 50,153
Accounts receivable, net of allowance for doubtful accounts of $1,652 and $1,691 at June 30, 2012 and December 31, 2011, respectively	67,347	61,085
Inventories	47,723	48,240
Prepaid expenses	2,417	2,219
Current deferred income taxes	5,093	5,144
Total current assets	163,340	166,841
PROPERTY, PLANT, AND EQUIPMENT, net	32,503	33,120
GOODWILL	11,619	11,619
OTHER ASSETS	265	262
ASSET TOTAL	207,727	211,842
CURRENT LIABILITIES:
Current portion of long-term obligations		5
Accounts payable	36,368	39,692
Accrued liabilities	15,429	17,384
Total current liabilities	51,797	57,081
LONG-TERM OBLIGATIONS, less current portion
DEFERRED INCOME TAX LIABILITIES	2,110	2,110
COMMITMENTS AND CONTINGENCIES (Notes 6 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, 11,067,331 and 11,000,119 outstanding at June 30, 2012 and December 31, 2011, respectively	111	110
Additional paid-in capital	147,748	147,004
Accumulated earnings	7,080	5,400
Accumulated other comprehensive income (loss)	(1,119)	137
Total shareholders' equity	153,820	152,651
LIABILITIES AND SHAREHOLDERS' EQUITY TOTAL	$ 207,727	$ 211,842

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
OPERATING ACTIVITIES:
Net income	$ 4,556	$ 13,220
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,850	1,732
Provision for doubtful accounts	154	90
Stock-based compensation	200	200
Excess tax benefit from stock-based compensation	(119)	(395)
Issuance of non-employee director shares	75	100
Deferred income tax provision	49	443
Changes in operating assets and liabilities:
Accounts receivable	(6,552)	(7,102)
Inventories	(62)	(10,363)
Prepaid expenses	(214)	1,459
Accounts payable	(3,069)	3,905
Accrued liabilities	(1,621)	5,700
Net cash flows from operating activities	(4,753)	8,989
INVESTING ACTIVITIES:
Purchases of property, plant and equipment	(1,292)	(926)
Proceeds from sale of property, plant and equipment	1	989
Payments received on notes receivable	8	173
Net cash flows from investing activities	(1,283)	236
FINANCING ACTIVITIES:
Payments on long-term obligations	(5)	(37)
Payments of cash dividends	(2,876)	(2,844)
Proceeds from stock option exercises	351	1,799
Excess tax benefit from stock-based compensation	119	395
Additions to deferred financing activities	(11)
Payments for common stock repurchased		(1,098)
Net cash flows from financing activities	(2,422)	(1,785)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND TEMPORARY INVESTMENTS	(935)	1,157
NET CHANGE IN CASH AND TEMPORARY INVESTMENTS	(9,393)	8,597
CASH AND TEMPORARY INVESTMENTS, beginning of period	50,153	46,334
CASH AND TEMPORARY INVESTMENTS, end of period	40,760	54,931
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash payments for interest	545	210
Cash payments for income taxes, net of refunds	$ 3,214	$ 2,004

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FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Level 1
Derivative financial instruments
Derivative financial asset
Derivative financial liabilities
Level 1 | Foreign currency contracts
Derivative financial instruments
Derivative financial asset
Derivative financial liabilities
Level 2
Derivative financial instruments
Derivative financial asset	3	43
Derivative financial liabilities
Level 2 | Foreign currency contracts
Derivative financial instruments
Derivative financial asset	3	43
Derivative financial liabilities
Level 3
Derivative financial instruments
Derivative financial asset
Derivative financial liabilities
Level 3 | Foreign currency contracts
Derivative financial instruments
Derivative financial asset
Derivative financial liabilities
Total
Derivative financial instruments
Derivative financial asset	3	43
Derivative financial liabilities
Total | Foreign currency contracts
Derivative financial instruments
Derivative financial asset	3	43
Derivative financial liabilities

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INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2012

Inventory Disclosure [Abstract]

Schedule of inventories, net of reserves

	June 30, 2012		December 31, 2011
Chassis	$	12,457	$	12,807
Raw materials		17,739		18,725
Work in process		7,829		8,426
Finished goods		9,698		8,282
	$	47,723	$	48,240

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DERIVATIVE FINANCIAL INSTRUMENTS (Detail Textuals) (USD $)	3 Months Ended	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2012	Dec. 31, 2011
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Foreign currency exchange contracts with notional values	$ 6,300,000	$ 6,300,000	$ 600,000
Gain (loss) on foreign currency exchange contracts	$ 288,000	$ (39,000)

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FAIR VALUE OF FINANCIAL INSTRUMENT (Tables)

6 Months Ended

Jun. 30, 2012

Fair Value Disclosures [Abstract]

Schedule of financial instruments measured at fair value on a recurring basis

	June 30, 2012
	Level 1		Level 2		Level 3		Total
(in thousands)
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	3	$	—	$	3
Total assets	$	—	$	3	$	—	$	3
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total liabilities	$	—	$	—	$	—	$	—

	December 31, 2011
	Level 1		Level 2		Level 3		Total
(in thousands)
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	43	$	—	$	43
Total assets	$	—	$	43	$	—	$	43
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total liabilities	$	—	$	—	$	—	$	—

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BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2012

Organization, Consolidation and Presentation Of Financial Statements [Abstract]

BASIS OF PRESENTATION

1. BASIS OF PRESENTATION

The condensed consolidated financial statements of Miller Industries, Inc. and subsidiaries (the “Company”) included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. Nevertheless, the Company believes that the disclosures are adequate to make the financial information presented not misleading. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, to present fairly the Company’s financial position, results of operations and cash flows at the dates and for the periods presented. Cost of goods sold for interim periods for certain entities is determined based on estimated gross profit rates. Interim results of operations are not necessarily indicative of results to be expected for the fiscal year. These condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2011. The consolidated financial statements include accounts of certain subsidiaries whose fiscal closing dates differ from December 31st by 31 days (or less) to facilitate timely reporting. Certain prior year amounts have been reclassified to conform to current year presentation, with no impact on previously reported shareholders’ equity. The Company evaluated subsequent events through the date the financial statements were issued.

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Statement Of Financial Position [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 1,652	$ 1,691
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, issued
Preferred stock, outstanding
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, outstanding	11,067,331	11,000,119

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GEOGRAPHIC INFORMATION

6 Months Ended

Jun. 30, 2012

Segment Reporting [Abstract]

GEOGRAPHIC INFORMATION

11. GEOGRAPHIC INFORMATION

Net sales and long-lived assets (property, plant and equipment and goodwill and intangible assets) by region were as follows (revenue is attributed to regions based on the locations of customers) (in thousands):

	For the Three Months Ended June 30						For the Six Months Ended June 30
	2012			2011			2012			2011
Net Sales:
North America		$	71,418		$	81,841		$	150,267		$	178,201
Foreign			15,928			15,725			32,036			28,290
		$	87,346		$	97,566		$	182,303		$	206,491

	June 30, 2012		December 31, 2011
Long Lived Assets:
North America	$	41,237	$	42,147
Foreign		2,885		2,592
	$	44,122	$	44,739

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Document and Entity Information	6 Months Ended
	Jun. 30, 2012	Aug. 03, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	MILLER INDUSTRIES INC /TN/
Entity Central Index Key	0000924822
Trading Symbol	mlr
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock Shares Outstanding		11,067,431
Document Type	10-Q
Document Period End Date	Jun. 30, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2

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CUSTOMER INFORMATION

6 Months Ended

Jun. 30, 2012

Risks and Uncertainties [Abstract]

CUSTOMER INFORMATION

12. CUSTOMER INFORMATION

No single customer accounted for 10% or more of consolidated net sales for the three and six months ended June 30, 2012. The Company’s largest customer accounted for 22.3% of consolidated net sales for the three months ended June 30, 2011, and 32.5% of consolidated net sales for the six months ended June 30, 2011. This customer represented 7.2% of accounts receivable at December 31, 2011.

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CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Income Statement [Abstract]
NET SALES	$ 87,346	$ 97,566	$ 182,303	$ 206,491
COSTS AND EXPENSES:
Costs of operations	76,781	80,092	160,854	168,284
Selling, general and administrative expenses	7,204	7,697	14,206	15,846
Interest expense, net	214	214	431	360
Other (income) expense	(1,039)	(9)	(703)	(9)
Total costs and expenses	83,160	87,994	174,788	184,481
INCOME BEFORE INCOME TAXES	4,186	9,572	7,515	22,010
INCOME TAX PROVISION	1,640	3,796	2,959	8,790
NET INCOME	$ 2,546	$ 5,776	$ 4,556	$ 13,220
BASIC INCOME PER COMMON SHARE (in dollars per share)	$ 0.23	$ 0.49	$ 0.41	$ 1.12
DILUTED INCOME PER COMMON SHARE (in dollars per share)	$ 0.23	$ 0.47	$ 0.40	$ 1.08
CASH DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share)	$ 0.13	$ 0.12	$ 0.26	$ 0.24
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic (in shares)	11,062	11,884	11,046	11,823
Diluted (in shares)	11,251	12,295	11,250	12,274

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LONG-TERM OBLIGATIONS

6 Months Ended

Jun. 30, 2012

Long-Term Debt, Unclassified [Abstract]

LONG-TERM OBLIGATIONS

6. LONG-TERM OBLIGATIONS

At June 30, 2012, the Company had no long-term obligations. At December 31, 2011, the Company had long-term obligations of $5,000, which consisted of equipment and other notes payable. Certain equipment was pledged as collateral under the Company’s equipment notes payable.

Credit Facility and Other Obligations

Credit Facility

On April 6, 2010, the Company entered into a Loan Agreement with First Tennessee Bank National Association for a $20.0 million unsecured revolving credit facility and on December 21, 2011 the credit facility was renewed and our unsecured revolving credit facility was increased to $25.0 million (the “Credit Facility”). The Credit Facility contains customary representations and warranties, events of default, and financial, affirmative and negative covenants for loan agreements of this kind. Covenants under the Credit Facility restrict the payment of cash dividends if the Company would be in violation of the minimum tangible net worth test or the leverage ratio test in the current loan agreement as a result of the dividends, among various other restrictions.

In the absence of a default, all borrowings under the Credit Facility bear interest at the LIBOR Rate plus 1.50% per annum. The Company will pay a non-usage fee under the current loan agreement in an annual amount between 0.15% and 0.35% of the unused amount of the Credit Facility, which fee shall be paid quarterly. The Credit Facility is scheduled to expire on March 31, 2014.

At June 30, 2012 and December 31, 2011, the Company had no outstanding borrowings under the Credit Facility.

Interest Rate Risk

Changes in interest rates affect the interest paid on indebtedness under the Credit Facility because outstanding amounts of indebtedness under the Credit Facility are subject to variable interest rates. Under the Credit Facility, the non-default rate of interest was equal to the LIBOR Market Index Rate plus 1.50% per annum (for a rate of interest of 1.75% at June 30, 2012). Because there were no amounts outstanding under the Credit Facility, a one percent change in the interest rate on our variable-rate debt would not have a material impact on our financial position, results of operations or cash flows for the three-month period ended June 30, 2012.

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GOODWILL

6 Months Ended

Jun. 30, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL

5. GOODWILL

Goodwill consists of the excess of cost of acquired entities over the sum of the amounts assigned to identifiable assets acquired less liabilities assumed. Goodwill is not amortized. However, the Company evaluates the carrying value of goodwill for impairment at least annually or if an event or circumstance occurs that would indicate that the carrying amount had been impaired. The Company reviews goodwill for impairment utilizing a qualitative assessment or a two-step process. If we choose to perform a qualitative analysis of goodwill and determine that the fair value more likely than not exceeds the carrying value, no further testing is needed. If we choose the two-step approach, the first step identifies potential impairment by comparing the fair value of the reporting unit with its carrying value. If the fair value exceeds the carrying value the second step is not necessary. If the carrying value is more than the fair value, the second step of testing is performed to compare the fair value of the goodwill with its carrying value. An impairment loss would be recognized to the extent that the carrying value of the goodwill exceeds its fair value.

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GEOGRAPHIC INFORMATION (Tables)

6 Months Ended

Jun. 30, 2012

Segment Reporting [Abstract]

Schedule of net sales and long-lived assets by region

	For the Three Months Ended June 30						For the Six Months Ended June 30
	2012			2011			2012			2011
Net Sales:
North America		$	71,418		$	81,841		$	150,267		$	178,201
Foreign			15,928			15,725			32,036			28,290
		$	87,346		$	97,566		$	182,303		$	206,491

	June 30, 2012		December 31, 2011
Long Lived Assets:
North America	$	41,237	$	42,147
Foreign		2,885		2,592
	$	44,122	$	44,739

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FAIR VALUE OF FINANCIAL INSTRUMENT

6 Months Ended

Jun. 30, 2012

Fair Value Disclosures [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENT

13.  FAIR VALUE OF FINANCIAL INSTRUMENTS

For assets and liabilities measured at fair value on a recurring and nonrecurring basis, a three-level hierarchy of measurements based upon observable and unobservable inputs is used to arrive at fair value. Observable inputs are developed based on market data obtained from independent sources, while unobservable inputs reflect our assumptions about valuation based on the best information available in the circumstances. Depending on the inputs, we classify each fair value measurement as follows:

Level 1—based upon quoted prices for identical instruments in active markets,

Level 2—based upon quoted prices for similar instruments, prices for identical or similar instruments in markets that are not active, or model-derived valuations, all of whose significant inputs are observable, and

Level 3—based upon one or more significant unobservable inputs.

The carrying values of cash and temporary investments, accounts receivable, accounts payable and accrued liabilities are reasonable estimates of their fair values because of the short maturity of these financial instruments.  The carrying values of long-term obligations are reasonable estimates of their fair values based on the rates available for obligations with similar terms and maturities.

The fair value of derivative assets and liabilities are measured assuming that the unit of account is an individual derivative transaction and that each derivative could be sold or transferred on a stand-alone basis. We classify within Level 2 our forward foreign currency exchange contracts based upon quoted prices for similar instruments that are actively traded.  For more information regarding derivatives, see Note 14, Derivative Financial Instruments.

The following table presents the financial instruments measured at fair value on a recurring basis:

	June 30, 2012
	Level 1		Level 2		Level 3		Total
(in thousands)
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	3	$	—	$	3
Total assets	$	—	$	3	$	—	$	3
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total liabilities	$	—	$	—	$	—	$	—

	December 31, 2011
	Level 1		Level 2		Level 3		Total
(in thousands)
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	43	$	—	$	43
Total assets	$	—	$	43	$	—	$	43
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total liabilities	$	—	$	—	$	—	$	—

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INCOME TAXES

6 Months Ended

Jun. 30, 2012

Income Tax Disclosure [Abstract]

INCOME TAXES

9. INCOME TAXES

At June 30, 2012 and December 31, 2011, the Company had no unrecognized income tax positions recorded. The Company does not expect its unrecognized tax positions to change significantly in the next twelve months. If unrecognized tax positions existed, the interest and penalties related to the unrecognized tax positions would be recorded as income tax expense in the consolidated statements of income.

The Company is subject to United States federal income taxes, as well as income taxes in various states and foreign jurisdictions. The Company’s tax years 2008 through 2010 remain open to examination for U.S. federal income taxes. With few exceptions, the Company is no longer subject to state or non-U.S. income tax examinations prior to 2008.

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STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2012

Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]

STOCK-BASED COMPENSATION

7. STOCK-BASED COMPENSATION

Stock compensation expense was $100,000 for each of the three month periods ended June 30, 2012 and 2011 and $200,000 for each of the six months ended June 30, 2012 and 2011. Stock compensation expenses are included in selling, general and administrative expenses in the accompanying consolidated statements of income. The Company did not issue any stock options during the three and six months ended June 30, 2012. As of June 30, 2012, the Company had $133,000 of unrecognized compensation expense related to stock options which will be expensed during the remainder of 2012. For additional disclosures related to the Company’s stock-based compensation refer to Notes 2 and 4 of the Notes to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

During the three months ended June 30, 2012 and 2011, options were exercised for the purchase of 9,800 shares of common stock at a weighted-average exercise price of $5.49 and 193,717 shares of common stock at a weighted-average exercise price of $6.13, respectively. During the six months ended June 30, 2012 and 2011, options were exercised for the purchase of 62,475 shares of common stock at a weighted-average exercise price of $5.61 and 298,652 shares of common stock at a weighted-average exercise price of $6.02, respectively.

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

8. COMMITMENTS AND CONTINGENCIES

Commitments

The Company has entered into arrangements with third-party lenders where it has agreed, in the event of default by a customer, to repurchase from the third-party lender Company products repossessed from the customer. These arrangements are typically subject to a maximum repurchase amount. The maximum amount of collateral that the Company could be required to purchase was approximately $24.8 million at June 30, 2012, and $18.1 million at December 31, 2011. However, the Company’s risk under these arrangements is mitigated by the value of the products that would be repurchased as part of the transaction. The Company considered the fair value at inception of its liability under these arrangements and concluded that the liability associated with these potential repurchase obligations is not material.

At June 30, 2012, the Company had commitments of approximately $1.1 million for construction and acquisition of property, plant and equipment.

Contingencies

The Company is, from time to time, a party to litigation arising in the normal course of its business. Litigation is subject to various inherent uncertainties, and it is possible that some of these matters could be resolved unfavorably to the Company, which could result in substantial damages against the Company. The Company has established accruals for matters that are probable and reasonably estimable and maintains product liability and other insurance that management believes to be adequate. Management believes that any liability that may ultimately result from the resolution of these matters in excess of available insurance coverage and accruals will not have a material adverse effect on the consolidated financial position or results of operations of the Company.

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SHAREHOLDERS EQUITY

6 Months Ended

Jun. 30, 2012

Stockholders' Equity Note [Abstract]

SHAREHOLDERS EQUITY

10. SHAREHOLDERS EQUITY

Dividends

On March 7, 2011, the Company’s board of directors declared an annual cash dividend of $0.12 per share. The dividend of $1,415,000 was paid on March 24, 2011 to shareholders of record as of March 17, 2011.

On May 10, 2011, the Company’s board of directors approved a dividend policy to consider and pay quarterly cash dividends on its common stock subject to the Company’s ability to satisfy all applicable statutory requirements and the Company’s current financial strength, replacing the previous policy of paying annual cash dividends. In conjunction with this new policy the board of directors declared the first such quarterly cash dividend of $0.12 per share. The dividend of $1,429,206 was paid on May 31, 2011 to shareholders of record as of May 23, 2011.

On August 5, 2011, the Company’s board of directors declared a quarterly cash dividend of $0.12 per share. The dividend of $1,364,963 was paid on August 26, 2011 to shareholders of record as of August 19, 2011.

On November 7, 2011, the Company’s board of directors declared a quarterly cash dividend of $0.12 per share. The dividend of $1,336,687 was paid on December 19, 2011 to shareholders of record as of December 5, 2011.

On March 5, 2012, the Company’s board of directors declared a quarterly cash dividend of $0.13 per share. The dividend of $1,437,200 was paid on March 26, 2012 to shareholders of record as of March 19, 2012.

On May 7, 2012, the Company’s board of directors declared a quarterly cash dividend of $0.13 per share. The dividend of $1,438,753 was paid on June 25, 2012 to shareholders of record as of June 18, 2012.

Stock Repurchase Program

In May 2011, the Company’s board of directors authorized the repurchase of up to $20.0 million of shares of its common stock. The repurchase program was completed in December 2011. A total of 1,184,200 shares were repurchased for $20.0 million during 2011.

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CUSTOMER INFORMATION (Detail Textuals) (Concentration Risk)	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2011 Net sales	Jun. 30, 2011 Net sales	Dec. 31, 2011 Accounts receivable
Concentration Risk [Line Items]
Percentage of Company's largest customer	22.30%	32.50%	7.20%

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RECENT ACCOUNTING PRONOUNCEMENTS

6 Months Ended

Jun. 30, 2012

New Accounting Pronouncements and Changes In Accounting Principles [Abstract]

RECENT ACCOUNTING PRONOUNCEMENTS

15. RECENT ACCOUNTING PRONOUNCEMENTS

Recently Adopted Standards

In June 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2011-05, “Presentation of Comprehensive Income” (ASU 2011-05). This standard amends guidance on the presentation of other comprehensive income in financial statements to improve the comparability, consistency and transparency and to increase the prominence of items that are recorded in other comprehensive income. Under ASU 2011-05, an entity has the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The provisions under ASU 2011-05 were effective for fiscal years beginning after December 15, 2011. We elected to adopt the two separate but consecutive statement presentation, and the adoption of this standard did not have a significant impact on our consolidated financial statements.

In September 2011, the FASB issued ASU 2011-08, “Testing Goodwill for Impairment”, which simplifies how an entity tests for goodwill impairment. After assessment of certain qualitative factors, if it is determined to be more likely than not that the fair value of a reporting unit is less than its carrying amount, entities must perform the quantitative analysis of the goodwill impairment test. Otherwise, the quantitative test(s) become optional. The provisions under ASU 2011-08 were effective for annual and interim goodwill impairment testing for fiscal years beginning after December 15, 2011. The adoption of this standard did not have an impact on our consolidated financial statements.

Recently Issued Standards

There are no recently issued accounting standards for which the Company expects a material impact on our financial statements.

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INVENTORIES (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Inventory Disclosure [Abstract]
Chassis	$ 12,457	$ 12,807
Raw materials	17,739	18,725
Work in process	7,829	8,426
Finished goods	9,698	8,282
INVENTORIES TOTAL	$ 47,723	$ 48,240

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Statement Of Income and Comprehensive Income [Abstract]
Net income	$ 2,546	$ 5,776	$ 4,556	$ 13,220
Other comprehensive income:
Foreign currency translation adjustment	(1,554)	808	(1,255)	1,700
Total other comprehensive income (loss)	(1,554)	808	(1,255)	1,700
Total comprehensive income	$ 992	$ 6,584	$ 3,301	$ 14,920

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LONG-LIVED ASSETS

6 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

LONG-LIVED ASSETS

4. LONG-LIVED ASSETS

The Company periodically reviews the carrying amount of its long-lived assets to determine if those assets may be recoverable based upon the future operating cash flows expected to be generated by those assets. Management believes that its long-lived assets are appropriately valued.

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LONG-TERM OBLIGATIONS (Detail Textuals) (USD $)	6 Months Ended
	Jun. 30, 2012	Dec. 31, 2011	Dec. 21, 2011	Apr. 06, 2010
Line of Credit Facility [Line Items]
Current portion of long-term obligations		$ 5,000
First Tennessee Bank National Association | Revolving Credit Facility
Line of Credit Facility [Line Items]
Unsecured revolving credit facility			25,000,000	20,000,000
Description of reference rate basis	LIBOR Market Index Rate
Variable interest rate in addition to reference rate	1.50%
Credit facility outstanding borrowings	$ 0	$ 0
Interest rate	1.75%
First Tennessee Bank National Association | Revolving Credit Facility | Maximum
Line of Credit Facility [Line Items]
Non-usage fee for current loan agreement in annual amount percentage	0.35%
First Tennessee Bank National Association | Revolving Credit Facility | Minimum
Line of Credit Facility [Line Items]
Non-usage fee for current loan agreement in annual amount percentage	0.15%

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DERIVATIVE FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS

14. DERIVATIVE FINANCIAL INSTRUMENTS

The Company periodically enters into certain forward foreign currency exchange contracts that are designed to mitigate foreign currency risk. These contracts are not designated as hedging instruments. At December 31, 2011, the Company had foreign currency exchange contracts (Euros to Dollars) with notional values aggregating $0.6 million maturing in April 2012. Additionally, at June 30, 2012, the Company had contracts with notional values aggregating $6.3 million maturing in the fourth quarter of 2013. The fair value of the contracts is presented in accounts receivable in our consolidated balance sheet. Changes in the fair value of the foreign currency exchange contracts are recognized each period in other income (expense) in our consolidated statement of income. A gain of $288,000 was recognized for the three months ended June 30, 2012 and a loss of $39,000 was recognized for the six months ended June 30, 2012.