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, 2014

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 July 31, 2014 was 11,301,530.

Index

PART I	FINANCIAL INFORMATION		Page Number
	Item 1.	Financial Statements
		Condensed Consolidated Balance Sheets – June 30, 2014 and December 31, 2013	2
		Condensed Consolidated Statements of Income for the Three and Six Months Ended June 30, 2014 and 2013	3
		Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2014 and 2013	4
		Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2014 and 2013	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	15
	Item 4.	Controls and Procedures	15
PART II		OTHER INFORMATION
	Item 1.	Legal Proceedings	16
	Item 1A.	Risk Factors	16
	Item 6.	Exhibits	17
SIGNATURES			18

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, the cyclical nature of our industry and changes in consumer confidence; economic and market conditions; our customer’s access to capital and credit to fund purchases, including the ability of our customers to secure floor plan financing; our dependence on outside suppliers of raw materials; changes in the cost of aluminum, steel and related raw materials; changes in fuel and other transportation costs, insurance costs and weather conditions; changes in government regulation; foreign currency fluctuation; competitors could impede our ability to attract or retain customers; our ability to develop or acquire proprietary products and technology; assertions against us relating to intellectual property rights; problems hiring or retaining skilled labor; the effects of new regulation relating to conflict minerals; the catastrophic loss of one of our manufacturing facilities; environmental and health and safety liabilities and requirements; loss of the services of our key executives; product warranty or product liability claims in excess of our insurance coverage; an inability to acquire insurance at commercially reasonable rates; 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 2013, 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, 2014 (Unaudited)		December 31, 2013
ASSETS
CURRENT ASSETS:
Cash and temporary investments	$	39,052	$	42,864
Accounts receivable, net of allowance for doubtful accounts of $1,807 and $1,714 at June 30, 2014 and December 31, 2013, respectively		96,109		80,821
Inventories		55,177		54,172
Prepaid expenses		3,758		2,190
Current deferred income taxes		4,012		3,888
Total current assets		198,108		183,935
PROPERTY, PLANT, AND EQUIPMENT, net		30,962		30,834
GOODWILL		11,619		11,619
OTHER ASSETS		256		281
	$	240,945	$	226,669
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	56,788	$	47,388
Accrued liabilities		17,021		15,726
Total current liabilities		73,809		63,114
DEFERRED INCOME TAX LIABILITIES		1,842		1,842
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, 11,301,530 and 11,265,679 outstanding at June 30, 2014 and December 31, 2013, respectively		113		113
Additional paid-in capital		149,906		149,608
Retained earnings		14,061		11,696
Accumulated other comprehensive income (loss)		1,214		814
Total Miller Industries, Inc. shareholders’ equity		165,294		162,231
Noncontrolling interests		—		(518	)
Total Shareholders’ equity		165,294		161,713
	$	240,945	$	226,669

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
	2014		2013		2014		2013
NET SALES	$	122,432	$	105,834	$	226,600	$	190,784
COSTS OF OPERATIONS		109,922		94,104		203,152		170,420
GROSS PROFIT		12,510		11,730		23,448		20,364
OPERATING EXPENSES:
Selling, general and administrative expenses		6,964		7,220		14,130		13,919
Interest expense, net		126		84		196		151
Other (income) expense, net		55		18		117		(5	)
Total operating expenses		7,145		7,322		14,443		14,065
INCOME BEFORE INCOME TAXES		5,365		4,408		9,005		6,299
INCOME TAX PROVISION		1,978		1,619		3,318		2,303
NET INCOME		3,387		2,789		5,687		3,996
NET LOSS ATTRIBUTABLE TO
NONCONTROLLING INTERESTS		—		112		66		233
NET INCOME ATTRIBUTABLE TO MILLER INDUSTRIES, INC.	$	3,387	$	2,901	$	5,753	$	4,229
BASIC INCOME PER COMMON SHARE	$	0.30	$	0.26	$	0.51	$	0.38
DILUTED INCOME PER COMMON SHARE	$	0.30	$	0.26	$	0.51	$	0.38
CASH DIVIDENDS DECLARED PER COMMON SHARE	$	0.15	$	0.14	$	0.30	$	0.28
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic		11,301		11,233		11,293		11,216
Diluted		11,354		11,318		11,354		11,317

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
	2014			2013			2014		2013
NET INCOME	$	3,387		$	2,789		$	5,687	$	3,996
OTHER COMPREHENSIVE INCOME (LOSS):
Foreign currency translation adjustment		(95	)		(117	)		165		(365	)
Derivative instrument and hedging activities		48			(199	)		75		139
Reclassification from accumulated other comprehensive income (loss)		89			—			160		—
Total other comprehensive income (loss)		42			(316	)		400		(226	)
COMPREHENSIVE INCOME		3,429			2,473			6,087		3,770
NET LOSS ATTRIBUTABLE TO
NONCONTROLLING INTERESTS		—			112			66		233
COMPREHENSIVE INCOME ATTRIBUTABLE
TO MILLER INDUSTRIES, INC.	$	3,429		$	2,585			6,153	$	4,003

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
	2014			2013
OPERATING ACTIVITIES:
Consolidated net income	$	5,687		$	3,996
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization		1,873			1,849
Loss on disposal of equipment		—			4
Loss on deconsolidation of subsidiary		83			—
Provision for doubtful accounts		95			92
Excess tax benefit from stock-based compensation		(22	)		(127	)
Issuance of non-employee director shares		96			75
Deferred income tax provision		(124	)		12
Changes in operating assets and liabilities:
Accounts receivable		(15,356	)		(20,592	)
Inventories		(744	)		(6,577	)
Prepaid expenses		(1,770	)		(979	)
Accounts payable		10,438			18,341
Accrued liabilities		1,023			3,107
Net cash flows from operating activities		1,279			(799	)
INVESTING ACTIVITIES:
Purchases of property, plant and equipment		(2,012	)		(1,721	)
Payments received on notes receivable		19			57
Net cash flows from investing activities		(1,993	)		(1,664	)
FINANCING ACTIVITIES:
Payments of cash dividends		(3,387	)		(3,142	)
Proceeds from stock option exercises		180			415
Excess tax benefit from stock-based compensation		22			127
Net cash flows from financing activities		(3,185	)		(2,600	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND TEMPORARY INVESTMENTS		87			(115	)
NET CHANGE IN CASH AND TEMPORARY INVESTMENTS		(3,812	)		(5,178	)
CASH AND TEMPORARY INVESTMENTS, beginning of period		42,864			48,591
CASH AND TEMPORARY INVESTMENTS, end of period	$	39,052		$	43,413
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash payments for interest	$	485		$	433
Cash payments for income taxes, net of refunds	$	3,090		$	334

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

5

MILLER INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(in thousands, except share data and except as otherwise noted)

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.  Net income (loss) attributable to noncontrolling interests represents the portion of the earnings or losses from the operations of the Company’s consolidated subsidiaries attributable to the interests of unrelated third party equity owners.  Net income (loss) attributable to noncontrolling interests is deducted from net income to arrive at net income attributable to Miller Industries, Inc.

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, 2013.  The condensed 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 attributable to Miller Industries, Inc. by the weighted average number of common shares outstanding. Diluted income per share is calculated by dividing net income attributable to Miller Industries, Inc. 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 53,000 and 85,000 potential dilutive common shares for the three months ended June 30, 2014 and 2013, and 61,000 and 101,000 for the six months ended June 30, 2014 and 2013, respectively.  For the three months and six months ended June 30, 2014 and 2013, 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, 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, 2014 and December 31, 2013 consisted of the following:

	June 30, 2014		December 31, 2013
Chassis	$	5,694	$	7,665
Raw materials		25,339		25,772
Work in process		10,525		9,915
Finished goods		13,619		10,820
	$	55,177	$	54,172

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.

6

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 has 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 or if qualitative analysis determines the carrying value more likely than not exceeds fair value, 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. LONG-TERM OBLIGATIONS

Credit Facility and Other Long-Term 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”). On December 17, 2013, the Credit Facility was further renewed to extend the maturity to March 31, 2016. 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.

At June 30, 2014 and December 31, 2013, 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 1.66% at June 30, 2014). 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, 2014.

Other Long-Term Obligations

At June 30, 2014, the Company had approximately $1,095 in non-cancelable operating lease obligations.

7. STOCK-BASED COMPENSATION

The Company did not issue any stock options during the three months ended June 30, 2014.  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, 2013.

During the three months ended June 30, 2014 and 2013, options were exercised for the purchase of 1,500 shares of common stock at a weighted-average exercise price of $5.49 and 1,500 shares of common stock at a weighted-average exercise price of $6.90, respectively.  During the six months ended June 30, 2014 and 2013, options were exercised for the purchase of 30,697 shares of common stock at a weighted-average exercise price of  $5.87 and 71,064 shares of common stock at a weighted-average exercise price of $5.84, 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 $31,830 at June 30, 2014, and $31,854 at December 31, 2013. 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.

7

At July 31, 2014, the Company had commitments of approximately $4,180 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.

9. INCOME TAXES

At June 30, 2014 and December 31, 2013, 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 condensed 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 2010 through 2012 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 2010.

10. SHAREHOLDERS EQUITY

Dividends

Prior to March 2010, we had never declared cash dividends on our common stock.  On March 8, 2010, our board of directors adopted a dividend policy to consider and pay annual cash dividends subject to our ability to satisfy all applicable statutory and regulatory requirements and our continued financial strength.  On May 10, 2011, the Company’s board of directors approved a dividend policy to consider and pay quarterly dividends on its common stock subject to the Company’s ability to satisfy all applicable statutory requirements and the Company’s continued financial strength, replacing the previous policy of paying annual cash dividends.  Dividend payments made for 2014, 2013, 2012 and 2011, were as follows:

Payment	Record Date	Payment Date	Dividend (per share)		Amount
Q1 2011	March 17, 2011	March 24, 2011	$	0.12	$	1,415
Q2 2011	May 23, 2011	May 31, 2011		0.12		1,429
Q3 2011	August 19, 2011	August 26, 2011		0.12		1,365
Q4 2011	December 5, 2011	December 19, 2011		0.12		1,336
Total for 2011			$	0.48	$	5,545
Q1 2012	March 19, 2012	March 26, 2012	$	0.13	$	1,437
Q2 2012	June 18, 2012	June 25, 2012		0.13		1,439
Q3 2012	September 17, 2012	September 24, 2012		0.13		1,439
Q4 2012	December 10, 2012	December 17, 2012		0.13		1,447
Total for 2012			$	0.52	$	5,762
Q1 2013	March 18, 2013	March 25, 2013	$	0.14	$	1,569
Q2 2013	June 17, 2013	June 24, 2013		0.14		1,573
Q3 2013	September 16, 2013	September 23, 2013		0.14		1,575
Q4 2013	December 9, 2013	December 16, 2013		0.14		1,577
Total for 2013			$	0.56	$	6,294
Q1 2014	March 17, 2014	March 24, 2014		0.15		1,692
Q2 2014	June 16, 2014	June 23, 2014	$	0.15	$	1,695
Total for 2014			$	0.30	$	3,387

On August 4, 2014, the Company’s Board of Directors declared a quarterly cash dividend of $0.15 per share.  The dividend is payable, September 22, 2014 to shareholders of record as of September 15, 2014.

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):

	For the Three Months Ended June 30				For the Six Months Ended June 30
	2014		2013		2014		2013
Net Sales:
North America	$	102,895	$	89,843	$	185,664	$	162,111
Foreign		19,537		15,991		40,936		28,673
	$	122,432	$	105,834	$	226,600	$	190,784

	June 30, 2014		December 31, 2013
Long Lived Assets:
North America	$	39,918	$	39,832
Foreign		2,663		2,645
	$	42,581	$	42,477

12. CUSTOMER INFORMATION

No single customer accounted for 10% or more of consolidated net sales for the three and six months ended June 30, 2014 and 2013.

13.  OTHER (INCOME) EXPENSE

Other (income) expense for the six months ended June 30, 2014 was a loss of $117 that includes a loss on deconsolidation of a subsidiary of $83 and foreign currency transaction losses of $34. On February 28, 2014, the Company entered into an agreement to sell all of its interest in the Delavan joint venture to its joint venture partner, which closed on March 31, 2014. Our Greeneville facility has ceased the manufacturing of Delavan products as of the end of the first quarter of 2014 so no further losses from the venture are expected. For the six months ended June 30, 2013, other (income) expense consisted of foreign currency transaction gains of $5.

14.  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 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 15, Derivative Financial Instruments.

9

The following table presents the financial instruments measured at fair value on a recurring basis:
	June 30, 2014
	Level 1		Level 2		Level 3		Total
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total assets	$	—	$	—	$	—	$	—
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	145	$	—	$	145
Total liabilities	$	—	$	145	$	—	$	145

	December 31, 2013
	Level 1		Level 2		Level 3		Total
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total assets	$	—	$	—	$	—	$	—
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	291	$	—	$	291
Total liabilities	$	—	$	291	$	—	$	291

15. DERIVATIVE FINANCIAL INSTRUMENTS

The Company periodically enters into foreign currency exchange contracts designed to mitigate the impact of foreign currency risk.  Prior to November 2012, the Company had not instituted a formal foreign currency exchange policy.  All contracts entered into prior to this date are accounted for as undesignated hedges and, therefore, changes in fair value are recognized each period in other (income) expense, net in our condensed consolidated statements of income.  The fair value of the contracts is presented in accounts receivable in our condensed consolidated balance sheets.  At June 30, 2013, the Company had undesignated foreign currency exchange contracts with notional amounts of $6,500 which were directly offset by corresponding foreign currency exchange contracts.  These contracts expired over a period from September to November 2013.  The gains or losses were directly offset at June 30, 2013.

In November 2012, the Company adopted a formal foreign currency exchange policy.  Under this policy, for those foreign currency exchange contracts that qualify for hedge accounting treatment, changes in the fair value of such instruments are included in accumulated other comprehensive income (loss).  The Company also assesses, both at inception and on an ongoing basis, whether the derivatives that are used in the hedging transaction are highly effective in offsetting changes in cash flows of the hedged items.  For those foreign currency exchange contracts that do not qualify for hedge accounting treatment, changes in the fair value of such instruments are recognized each period in other (income) expense, net in our condensed consolidated statements of income.  In December 2012, the Company entered into foreign exchange currency contracts with notional values of $4,418 at June 30, 2014 and $10,200 at December 31, 2013 maturing from September 2013 to October 2014 that were considered cash flow hedges.  Changes in fair value of such cash flow hedges are recorded in accumulated other comprehensive income (loss) to the extent that the hedges are considered effective.  At June 30, 2014 and December 31, 2013, the net fair value of foreign currency exchange contracts was ($145)and ($291), respectively, which is included in accounts receivable or accounts payable in our condensed consolidated balance sheets, depending on the asset or liability position of the derivative.

10

16. RECENT ACCOUNTING PRONOUNCEMENTS

Recently Adopted Standards

In April 2014, the FASB issued Accounting Standards Update No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (FASB ASU 2014-08).  The amendment revises the definition of a discontinued operation to a disposal, sale or held-for-sale component or group of components that represents a strategic shift that will have a major effect on an entity's operations and financial results. The amendments in this ASU are effective for reporting periods beginning after December 15, 2014 with early adoption permitted in the first quarter of 2014 for calendar year-end companies.  We have chosen to early adopt this pronouncement and it became effective for the Company in the first quarter of 2014. The adoption of the provisions of FASB ASU 2014-08 did not have a material impact on the Company’s consolidated financial statements.

Recently Issued Standards

In May 2014, the FASB issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) (FASB ASU 2014-09), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition.  ASU 2014-09 outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized. The new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. The provisions of FASB ASU 2014-09 are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted.  We are currently evaluating the impact of the adoption of this ASU on our consolidated 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).

11

Our industry is cyclical in nature. In recent years, the overall demand for our products and resulting revenues have been positively affected by recovering economic conditions and improving consumer sentiment. However, historically, the overall demand for our products and our resulting revenues have at times been 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; and

● the overall effects of global economic downturns.

We remain concerned about the continuing effects of these factors on the towing and recovery industry, and 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.

As previously announced, our financial results through June 30, 2014 were negatively impacted by the Delavan joint venture. Losses before income taxes that are directly attributable to the Delavan joint venture were approximately $1,300 and $152 (including the loss on deconsolidation of the subsidiary) for 2013 and the first quarter of 2014, respectively. The Company also generated additional indirect losses associated with the Greeneville, Tennessee facility in connection with its manufacturing and supply agreement for the joint venture.  Following a review and evaluation of operations related to the Delavan joint venture, the Company made the decision to consider strategic alternatives with regard to the venture. On February 28, 2014, the Company entered into an agreement to sell all of its interest in the Delavan joint venture to its joint venture partner, which closed on March 31, 2014. Our Greeneville facility has ceased the manufacturing of Delavan products as of the end of the first quarter of 2014 so no further losses from the venture are expected.

There were no borrowings under the credit facility at June 30, 2014.

Critical Accounting Policies

Our condensed 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, 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.

12

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 or if qualitative analysis determines the carrying value more likely than not exceeds fair value, 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.

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.  We consider the need to record a valuation allowance to reduce deferred tax assets to the amount that is more likely than not to be realized.  We consider tax loss carryforwards, reversal of deferred tax liabilities, tax planning and estimates of future taxable income in assessing the need for a valuation allowance.  If unrecognized tax positions exist, we record interest and penalties related to the unrecognized tax positions as income tax expense in our condensed 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 condensed consolidated statements of income.

Results of Operations–Three Months Ended June 30, 2014 Compared to Three Months Ended June 30, 2013

Net sales for the three months ended June 30, 2014 increased 15.7%  to $122,432 from $105,834 for the comparable period in 2013. The increase in revenue was primarily attributable to increased demand levels in our domestic and international markets and corresponding increases in production levels based on recovering economic conditions and improving consumer sentiment.

13

Costs of operations for the three months ended June 30, 2014 increased 16.8% to $109,922 from $94,104 for the comparable period in 2013, which was attributable to the increased demand levels and increased production.  Overall, costs of operations increased slightly as a percentage of sales from 88.9% to 89.8%.

Selling, general, and administrative expenses for the three months ended June 30, 2014 decreased to $6,964 from $7,220 for the three months ended June 30, 2013.  As a percentage of sales, selling, general, and administrative expenses decreased to 5.7% for the three months ended June 30, 2014 from 6.8% for the three months ended June 30, 2013 due to the fixed nature of certain of these expenses.  Additionally, decreases in selling, general and administrative expenses as a percentage of sales resulted from lower sales-related expenses due to product mix during the quarter, as well as our continued focus on cost control.

Total interest expense increased slightly to $126 from $84 for the three months ended June 30, 2014 as compared to the prior year period.

Other (income) expense relates to foreign currency translation gains and losses.  During the three months ended June 30, 2014, the loss was $55 compared to a loss of $18 for the prior year period.

The provision for income taxes for the three months ended June 30, 2014 and 2013 reflects a combined effective U.S. federal, state and foreign tax rate of 36.9% and 36.7%, respectively.

Results of Operations–Six Months Ended June 30, 2014 Compared to Six Months Ended June 30, 2013

Net sales for the six months ended June 30, 2014 increased 18.8% to $226,600 from $190,784 for the comparable period in 2013. The increase in revenue was primarily attributable to increased demand levels in our domestic and international markets and corresponding increases in production levels based on recovering economic conditions and improving consumer sentiment.

Costs of operations for the six months ended June 30, 2014 increased 19.2% to $203,152 from $170,420 for the comparable period in 2013, which was attributable to the increased demand levels and increased production.  Overall, costs of operations increased slightly as a percentage of sales from 89.3% to 89.6%.

Selling, general, and administrative expenses for the six months ended June 30, 2014 increased to $14,130 from $13,919 for the six months ended June 30, 2013.  As a percentage of sales, selling, general, and administrative expenses decreased to 6.2% for the six months ended June 30, 2014 from 7.3% for the six months ended June 30, 2013 due to the fixed nature of certain of these expenses.  Additionally, decreases in selling, general and administrative expenses as a percentage of sales resulted from lower sales-related expenses due to product mix during the quarter, as well as our continued focus on cost control.

Total interest expense increased slightly to $196 from $151 for the six months ended June 30, 2014 as compared to the prior year period.

Other (income) expense, net for the six months ended June 30, 2014 was a loss of $117 that includes a loss on deconsolidation of a subsidiary of $83 and foreign currency transaction losses of $34.  This compares to foreign currency transaction gains of $5 for the six months ended June 30, 2013.

The provision for income taxes for the six months ended June 30, 2014 and 2013 reflects a combined effective U.S. federal, state and foreign tax rate of 36.9% and 36.6%, respectively.

Liquidity and Capital Resources

Cash provided by operating activities was $1,279 for the six months ended June 30, 2014, compared to cash used in operating activities of $799 for the comparable period in 2013.  The cash provided by operating activities for the 2014 period was attributable to consolidated net income.  Cash provided by operating income also reflects increases in accounts receivable and accounts payable.  Certain components of accounts receivable and accounts payable have extended collection and payment terms.

Cash used in investing activities was $1,993 for the six months ended June 30, 2014 compared to $1,664 for the comparable period in 2013. The cash used in investing activities for the 2014 period was primarily for the purchase of property, plant and equipment.

Cash used in financing activities was $3,185 for the six months ended June 30, 2014, compared to $2,600 for the comparable period in 2013. The cash used in financing activities for the 2014 period was primarily to pay cash dividends, slightly offset by proceeds from the exercise of stock options.

As of June 30, 2014, we had cash and cash equivalents of $39,052, 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 July 31, 2014, the Company had commitments of approximately $4,180 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, 2014, with borrowings under our credit facility being available if needed. We expect these sources to be sufficient to satisfy our cash needs during 2014 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.

14

As of June 30, 2014 and December 31, 2013, $12,505 and $14,306, respectively, of the Company’s cash and temporary investments were held by foreign subsidiaries and their holdings are generally based in the local currency. Amounts held by foreign subsidiaries are generally subject to U.S. income taxation on repatriation to the U.S.

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”). On December 17, 2013, the Credit Facility was further renewed to extend the maturity to March 31, 2016.  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.

At June 30, 2014 and December 31, 2013, the Company had no outstanding borrowings under the Credit Facility.

Other Long-Term Obligations

At June 30, 2014, we had approximately $1,095 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.

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 1.66% at June 30, 2014). 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, 2014.

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.  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, 2014, we recognized a $165 increase in our foreign currency translation adjustment account compared with December 31, 2013 because of fluctuations of the U.S. dollar against certain foreign currencies compared to a $365 decrease for the prior year period.  For the three months ended June 30, 2014 and 2013, the impact of foreign currency exchange rate changes on our results of operations and cash flows was a loss of $55 and $18, respectively.  For the six months ended June 30, 2014 and 2013, the impact of foreign currency exchange rate changes on the results of operations and cash flows was a loss of $34 and a gain of $5, 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 co-Chief Executive Officers (CEOs) and Chief Financial Officer (CFO), of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-14(c) under the Securities Exchange Act of 1934. Based upon this evaluation, our CEOs 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.

15

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, 2013.

16

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 Co-Chief Executive Officer*
31.2	Certification Pursuant to Rules 13a-14(a)/15d- 14(a) by Co-Chief Executive Officer*
31.3	Certification Pursuant to 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 Co-Chief Executive Officer*
32.2	Certification Pursuant to Section 1350 of Chapter 63 of Title 18 of United States Code by Co-Chief Executive Officer*
32.3	Certification Pursuant to Section 1350 of Chapter 63 of Title 18 of United States Code by Chief Financial Officer*
101	The following information from the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2014 formatted in Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets – June 30, 2014 and December 31, 2013; (ii) Condensed Consolidated Statements of Income for the three and six months ended June 30, 2014 and 2013; (iii) Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2014 and 2013; (iv) Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2014 and 2013; and (v) Notes to Condensed Consolidated Financial Statements.*
	*Filed herewith

17

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 6, 2014

18

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 6, 2014

/s/ Jeffrey I. Badgley

Jeffrey I. Badgley

Co-Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, William G. Miller II, 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 6, 2014

/s/ William G. Miller II

William G. Miller II

President and Co-Chief Executive Officer

EX-31.3

Exhibit 31.3

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 6, 2014

/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, Co-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, 2014 (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 6, 2014

/s/ Jeffrey I. Badgley

Jeffrey I. Badgley

Co-Chief Executive Officer

EX-32.2

Exhibit 32.2

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

I, William G. Miller II, President and Co-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, 2014 (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 6, 2014

/s/ William G. Miller II

William G. Miller II

President and Co-Chief Executive Officer

EX-32.3

Exhibit 32.3

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, 2014 (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 6, 2014

/s/ J. Vincent Mish

J. Vincent Mish

Executive Vice President and Chief Financial Officer

XML

SHAREHOLDERS EQUITY (Detail Textuals) (USD $)	3 Months Ended														6 Months Ended	12 Months Ended			0 Months Ended
	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Jun. 30, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Aug. 04, 2014 Subsequent Event
Stockholders Equity Note [Line Items]
Dividend (per share)	$ 0.15	$ 0.15	$ 0.14	$ 0.14	$ 0.14	$ 0.14	$ 0.13	$ 0.13	$ 0.13	$ 0.13	$ 0.12	$ 0.12	$ 0.12	$ 0.12	$ 0.30	$ 0.56	$ 0.52	$ 0.48	$ 0.15
Payment Date	Jun. 23, 2014	Mar. 24, 2024	Dec. 16, 2013	Sep. 23, 2013	Jun. 24, 2013	Mar. 25, 2013	Dec. 17, 2012	Sep. 24, 2012	Jun. 25, 2012	Mar. 26, 2012	Dec. 19, 2011	Aug. 26, 2011	May 31, 2011	Mar. 24, 2011					Sep. 22, 2014
Record Date	Jun. 16, 2014	Mar. 17, 2014	Dec. 09, 2013	Sep. 16, 2013	Jun. 17, 2013	Mar. 18, 2013	Dec. 10, 2012	Sep. 17, 2012	Jun. 18, 2012	Mar. 19, 2012	Dec. 05, 2011	Aug. 19, 2011	May 23, 2011	Mar. 17, 2011					Sep. 15, 2014

XML

GEOGRAPHIC INFORMATION (Tables)

6 Months Ended

Jun. 30, 2014

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
	2014		2013		2014		2013
Net Sales:
North America	$	102,895	$	89,843	$	185,664	$	162,111
Foreign		19,537		15,991		40,936		28,673
	$	122,432	$	105,834	$	226,600	$	190,784

	June 30, 2014		December 31, 2013
Long Lived Assets:
North America	$	39,918	$	39,832
Foreign		2,663		2,645
	$	42,581	$	42,477

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS - Financial instruments measured at fair value on a recurring basis (Details) (Fair value, recurring basis, USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Level 1
Derivative financial instruments
Derivative financial current assets
Derivative financial current liability
Level 1 | Foreign currency contracts
Derivative financial instruments
Derivative financial current assets
Derivative financial current liability
Level 2
Derivative financial instruments
Derivative financial current assets
Derivative financial current liability	145	291
Level 2 | Foreign currency contracts
Derivative financial instruments
Derivative financial current assets
Derivative financial current liability	145	291
Level 3
Derivative financial instruments
Derivative financial current assets
Derivative financial current liability
Level 3 | Foreign currency contracts
Derivative financial instruments
Derivative financial current assets
Derivative financial current liability
Total
Derivative financial instruments
Derivative financial current assets
Derivative financial current liability	145	291
Total | Foreign currency contracts
Derivative financial instruments
Derivative financial current assets
Derivative financial current liability	$ 145	$ 291

XML

INVENTORIES

6 Months Ended

Jun. 30, 2014

Inventory Disclosure [Abstract]

INVENTORIES

3. INVENTORIES

Inventory costs include materials, labor and factory overhead. Inventories are stated at the lower of cost or market, 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, 2014 and December 31, 2013 consisted of the following:

	June 30, 2014		December 31, 2013
Chassis	$	5,694	$	7,665
Raw materials		25,339		25,772
Work in process		10,525		9,915
Finished goods		13,619		10,820
	$	55,177	$	54,172

XML

LONG-TERM OBLIGATIONS (Detail Textuals) (USD $)	6 Months Ended
	Jun. 30, 2014	Dec. 21, 2011	Apr. 06, 2010
Long-Term Debt, Unclassified [Abstract]
Non-cancelable operating lease obligations	$ 1,095,000
First Tennessee Bank National Association | Revolving Credit Facility
Line of Credit Facility [Line Items]
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%
Interest rate	1.66%
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%
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%

XML

INVENTORIES - Summary of inventories, net of reserves (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Inventory Disclosure [Abstract]
Chassis	$ 5,694	$ 7,665
Raw materials	25,339	25,772
Work in process	10,525	9,915
Finished goods	13,619	10,820
Inventories	$ 55,177	$ 54,172

XML

STOCK-BASED COMPENSATION (Detail Textuals) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]
Options exercised for purchase of common stock	1,500	1,500	30,697	71,064
Weighted-average exercise price	$ 5.49	$ 6.90	$ 5.87	$ 5.84

XML

COMMITMENTS AND CONTINGENCIES (Detail Textuals) (USD $) In Thousands, unless otherwise specified			6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2014 Capital Addition Purchase Commitments
Commitments and Contingencies Disclosure [Abstract]
Maximum repurchase collateral amount	$ 31,830	$ 31,854
Long-term Purchase Commitment [Line Items]
Commitment for construction and acquisition of property, plant and equipment			$ 4,180

XML

BASIC AND DILUTED INCOME PER SHARE

6 Months Ended

Jun. 30, 2014

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 attributable to Miller Industries, Inc. by the weighted average number of common shares outstanding. Diluted income per share is calculated by dividing net income attributable to Miller Industries, Inc. 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 53,000 and 85,000 potential dilutive common shares for the three months ended June 30, 2014 and 2013, and 61,000 and 101,000 for the six months ended June 30, 2014 and 2013, respectively.  For the three months and six months ended June 30, 2014 and 2013, none of the outstanding stock options would have been anti-dilutive.

XML

SHAREHOLDERS EQUITY - Summary of Dividend payments (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended														6 Months Ended	12 Months Ended
	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Jun. 30, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Stockholders' Equity Note [Abstract]
Record Date	Jun. 16, 2014	Mar. 17, 2014	Dec. 09, 2013	Sep. 16, 2013	Jun. 17, 2013	Mar. 18, 2013	Dec. 10, 2012	Sep. 17, 2012	Jun. 18, 2012	Mar. 19, 2012	Dec. 05, 2011	Aug. 19, 2011	May 23, 2011	Mar. 17, 2011
Payment Date	Jun. 23, 2014	Mar. 24, 2024	Dec. 16, 2013	Sep. 23, 2013	Jun. 24, 2013	Mar. 25, 2013	Dec. 17, 2012	Sep. 24, 2012	Jun. 25, 2012	Mar. 26, 2012	Dec. 19, 2011	Aug. 26, 2011	May 31, 2011	Mar. 24, 2011
Dividend (per share)	$ 0.15	$ 0.15	$ 0.14	$ 0.14	$ 0.14	$ 0.14	$ 0.13	$ 0.13	$ 0.13	$ 0.13	$ 0.12	$ 0.12	$ 0.12	$ 0.12	$ 0.30	$ 0.56	$ 0.52	$ 0.48
Dividend paid, amount	$ 1,695	$ 1,692	$ 1,577	$ 1,575	$ 1,573	$ 1,569	$ 1,447	$ 1,439	$ 1,439	$ 1,437	$ 1,336	$ 1,365	$ 1,429	$ 1,415	$ 3,387	$ 6,294	$ 5,762	$ 5,545

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
CURRENT ASSETS:
Cash and temporary investments	$ 39,052	$ 42,864
Accounts receivable, net of allowance for doubtful accounts of $1,807 and $1,714 at June 30, 2014 and December 31, 2013, respectively	96,109	80,821
Inventories	55,177	54,172
Prepaid expenses	3,758	2,190
Current deferred income taxes	4,012	3,888
Total current assets	198,108	183,935
PROPERTY, PLANT, AND EQUIPMENT, net	30,962	30,834
GOODWILL	11,619	11,619
OTHER ASSETS	256	281
TOTAL ASSETS	240,945	226,669
CURRENT LIABILITIES:
Accounts payable	56,788	47,388
Accrued liabilities	17,021	15,726
Total current liabilities	73,809	63,114
DEFERRED INCOME TAX LIABILITIES	1,842	1,842
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, 11,301,530 and 11,265,679 outstanding at June 30, 2014 and December 31, 2013, respectively	113	113
Additional paid-in capital	149,906	149,608
Retained earnings	14,061	11,696
Accumulated other comprehensive income (loss)	1,214	814
Total Miller Industries, Inc. shareholders' equity	165,294	162,231
Noncontrolling interests		(518)
Total Shareholders' equity	165,294	161,713
Total Liabilities And Shareholders' Equity	$ 240,945	$ 226,669

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
OPERATING ACTIVITIES:
Consolidated net income	$ 5,687	$ 3,996
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	1,873	1,849
Loss on disposal of equipment		4
Loss on deconsolidation of subsidiary	83
Provision for doubtful accounts	95	92
Excess tax benefit from stock-based compensation	(22)	(127)
Issuance of non-employee director shares	96	75
Deferred income tax provision	(124)	12
Changes in operating assets and liabilities:
Accounts receivable	(15,356)	(20,592)
Inventories	(744)	(6,577)
Prepaid expenses	(1,770)	(979)
Accounts payable	10,438	18,341
Accrued liabilities	1,023	3,107
Net cash flows from operating activities	1,279	(799)
INVESTING ACTIVITIES:
Purchases of property, plant and equipment	(2,012)	(1,721)
Payments received on notes receivable	19	57
Net cash flows from investing activities	(1,993)	(1,664)
FINANCING ACTIVITIES:
Payments of cash dividends	(3,387)	(3,142)
Proceeds from stock option exercises	180	415
Excess tax benefit from stock-based compensation	22	127
Net cash flows from financing activities	(3,185)	(2,600)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND TEMPORARY INVESTMENTS	87	(115)
NET CHANGE IN CASH AND TEMPORARY INVESTMENTS	(3,812)	(5,178)
CASH AND TEMPORARY INVESTMENTS, beginning of period	42,864	48,591
CASH AND TEMPORARY INVESTMENTS, end of period	39,052	43,413
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash payments for interest	485	433
Cash payments for income taxes, net of refunds	$ 3,090	$ 334

XML

CUSTOMER INFORMATION (Detail Textuals) (Customer Concentration Risk, Net sales)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Customer Concentration Risk | Net sales
Concentration Risk [Line Items]
Major customer, benchmark description	No single customer accounted for 10% or more of consolidated net sales	No single customer accounted for 10% or more of consolidated net sales
Percentage of company's largest customer	10.00%	10.00%

XML

RECENT ACCOUNTING PRONOUNCEMENTS

6 Months Ended

Jun. 30, 2014

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

RECENT ACCOUNTING PRONOUNCEMENTS

16. RECENT ACCOUNTING PRONOUNCEMENTS

Recently Adopted Standards

In April 2014, the FASB issued Accounting Standards Update No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (FASB ASU 2014-08). The amendment revises the definition of a discontinued operation to a disposal, sale or held-for-sale component or group of components that represents a strategic shift that will have a major effect on an entity's operations and financial results. The amendments in this ASU are effective for reporting periods beginning after December 15, 2014 with early adoption permitted in the first quarter of 2014 for calendar year-end companies. We have chosen to early adopt this pronouncement and it became effective for the Company in the first quarter of 2014. The adoption of the provisions of FASB ASU 2014-08 did not have a material impact on the Company’s consolidated financial statements.

Recently Issued Standards

In May 2014, the FASB issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) (FASB ASU 2014-09), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized. The new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. The provisions of FASB ASU 2014-09 are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. We are currently evaluating the impact of the adoption of this ASU on our consolidated financial statements.

XML

OTHER (INCOME) EXPENSE (Detail Textuals) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Other Income and Expenses [Abstract]
Other (income) expense, net	$ 55	$ 18	$ 117	$ (5)
Loss on deconsolidation of subsidiary			83
Foreign currency transaction gains/losses			$ (34)	$ 5

XML

SHAREHOLDERS EQUITY (Tables)

6 Months Ended

Jun. 30, 2014

Stockholders' Equity Note [Abstract]

Schedule of dividends payments

Payment	Record Date	Payment Date	Dividend (per share)		Amount
Q1 2011	March 17, 2011	March 24, 2011	$	0.12	$	1,415
Q2 2011	May 23, 2011	May 31, 2011		0.12		1,429
Q3 2011	August 19, 2011	August 26, 2011		0.12		1,365
Q4 2011	December 5, 2011	December 19, 2011		0.12		1,336
Total for 2011			$	0.48	$	5,545
Q1 2012	March 19, 2012	March 26, 2012	$	0.13	$	1,437
Q2 2012	June 18, 2012	June 25, 2012		0.13		1,439
Q3 2012	September 17, 2012	September 24, 2012		0.13		1,439
Q4 2012	December 10, 2012	December 17, 2012		0.13		1,447
Total for 2012			$	0.52	$	5,762
Q1 2013	March 18, 2013	March 25, 2013	$	0.14	$	1,569
Q2 2013	June 17, 2013	June 24, 2013		0.14		1,573
Q3 2013	September 16, 2013	September 23, 2013		0.14		1,575
Q4 2013	December 9, 2013	December 16, 2013		0.14		1,577
Total for 2013			$	0.56	$	6,294
Q1 2014	March 17, 2014	March 24, 2014		0.15		1,692
Q2 2014	June 16, 2014	June 23, 2014	$	0.15	$	1,695
Total for 2014			$	0.30	$	3,387

XML

BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2014

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.  Net income (loss) attributable to noncontrolling interests represents the portion of the earnings or losses from the operations of the Company’s consolidated subsidiaries attributable to the interests of unrelated third party equity owners.  Net income (loss) attributable to noncontrolling interests is deducted from net income to arrive at net income attributable to Miller Industries, Inc.

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, 2013.  The condensed 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.

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) (USD $) In Thousands, except Share data, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Statement Of Financial Position [Abstract]
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 1,807	$ 1,714
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares outstanding	11,301,530	11,265,679

XML

GEOGRAPHIC INFORMATION

6 Months Ended

Jun. 30, 2014

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):

	For the Three Months Ended June 30				For the Six Months Ended June 30
	2014		2013		2014		2013
Net Sales:
North America	$	102,895	$	89,843	$	185,664	$	162,111
Foreign		19,537		15,991		40,936		28,673
	$	122,432	$	105,834	$	226,600	$	190,784

	June 30, 2014		December 31, 2013
Long Lived Assets:
North America	$	39,918	$	39,832
Foreign		2,663		2,645
	$	42,581	$	42,477

XML

Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Jul. 31, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	MILLER INDUSTRIES INC /TN/
Entity Central Index Key	0000924822
Trading Symbol	mlr
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock Shares Outstanding		11,301,530
Document Type	10-Q
Document Period End Date	Jun. 30, 2014
Amendment Flag	false
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2

XML

CUSTOMER INFORMATION

6 Months Ended

Jun. 30, 2014

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, 2014 and 2013.

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Income Statement [Abstract]
NET SALES	$ 122,432	$ 105,834	$ 226,600	$ 190,784
COSTS OF OPERATIONS	109,922	94,104	203,152	170,420
GROSS PROFIT	12,510	11,730	23,448	20,364
OPERATING EXPENSES:
Selling, general and administrative expenses	6,964	7,220	14,130	13,919
Interest expense, net	126	84	196	151
Other (income) expense, net	55	18	117	(5)
Total operating expenses	7,145	7,322	14,443	14,065
INCOME BEFORE INCOME TAXES	5,365	4,408	9,005	6,299
INCOME TAX PROVISION	1,978	1,619	3,318	2,303
NET INCOME	3,387	2,789	5,687	3,996
NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS		112	66	233
NET INCOME ATTRIBUTABLE TO MILLER INDUSTRIES, INC.	$ 3,387	$ 2,901	$ 5,753	$ 4,229
BASIC INCOME PER COMMON SHARE (in dollars per share)	$ 0.30	$ 0.26	$ 0.51	$ 0.38
DILUTED INCOME PER COMMON SHARE (in dollars per share)	$ 0.30	$ 0.26	$ 0.51	$ 0.38
CASH DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share)	$ 0.15	$ 0.14	$ 0.30	$ 0.28
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic (in shares)	11,301	11,233	11,293	11,216
Diluted (in shares)	11,354	11,318	11,354	11,317

XML

LONG-TERM OBLIGATIONS

6 Months Ended

Jun. 30, 2014

Long-Term Debt, Unclassified [Abstract]

LONG-TERM OBLIGATIONS

6. LONG-TERM OBLIGATIONS

Credit Facility and Other Long-Term 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”). On December 17, 2013, the Credit Facility was further renewed to extend the maturity to March 31, 2016. 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.

At June 30, 2014 and December 31, 2013, 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 1.66% at June 30, 2014). 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, 2014.

Other Long-Term Obligations

At June 30, 2014, the Company had approximately $1,095 in non-cancelable operating lease obligations.

XML

GOODWILL

6 Months Ended

Jun. 30, 2014

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 has 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 or if qualitative analysis determines the carrying value more likely than not exceeds fair value, 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.

XML

INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2014

Inventory Disclosure [Abstract]

Schedule of inventories, net of reserves

	June 30, 2014		December 31, 2013
Chassis	$	5,694	$	7,665
Raw materials		25,339		25,772
Work in process		10,525		9,915
Finished goods		13,619		10,820
	$	55,177	$	54,172

XML

OTHER (INCOME) EXPENSE

6 Months Ended

Jun. 30, 2014

Other Income and Expenses [Abstract]

OTHER (INCOME) EXPENSE

13.  OTHER (INCOME) EXPENSE

Other (income) expense for the six months ended June 30, 2014 was a loss of $117 that includes a loss on deconsolidation of a subsidiary of $83 and foreign currency transaction losses of $34. On February 28, 2014, the Company entered into an agreement to sell all of its interest in the Delavan joint venture to its joint venture partner, which closed on March 31, 2014. Our Greeneville facility has ceased the manufacturing of Delavan products as of the end of the first quarter of 2014 so no further losses from the venture are expected. For the six months ended June 30, 2013, other (income) expense consisted of foreign currency transaction gains of $5.

XML

INCOME TAXES

6 Months Ended

Jun. 30, 2014

Income Tax Disclosure [Abstract]

INCOME TAXES

9. INCOME TAXES

At June 30, 2014 and December 31, 2013, 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 condensed 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 2010 through 2012 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 2010.

XML

STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2014

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

STOCK-BASED COMPENSATION

7. STOCK-BASED COMPENSATION

The Company did not issue any stock options during the three months ended June 30, 2014.  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, 2013.

During the three months ended June 30, 2014 and 2013, options were exercised for the purchase of 1,500 shares of common stock at a weighted-average exercise price of $5.49 and 1,500 shares of common stock at a weighted-average exercise price of $6.90, respectively.  During the six months ended June 30, 2014 and 2013, options were exercised for the purchase of 30,697 shares of common stock at a weighted-average exercise price of  $5.87 and 71,064 shares of common stock at a weighted-average exercise price of $5.84, respectively.

XML

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2014

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 $31,830 at June 30, 2014, and $31,854 at December 31, 2013. 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 July 31, 2014, the Company had commitments of approximately $4,180 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.

XML

SHAREHOLDERS EQUITY

6 Months Ended

Jun. 30, 2014

Stockholders' Equity Note [Abstract]

SHAREHOLDERS EQUITY

10. SHAREHOLDERS EQUITY

Dividends

Prior to March 2010, we had never declared cash dividends on our common stock.  On March 8, 2010, our board of directors adopted a dividend policy to consider and pay annual cash dividends subject to our ability to satisfy all applicable statutory and regulatory requirements and our continued financial strength.  On May 10, 2011, the Company’s board of directors approved a dividend policy to consider and pay quarterly dividends on its common stock subject to the Company’s ability to satisfy all applicable statutory requirements and the Company’s continued financial strength, replacing the previous policy of paying annual cash dividends.  Dividend payments made for 2014, 2013, 2012 and 2011, were as follows:

Payment	Record Date	Payment Date	Dividend (per share)		Amount
Q1 2011	March 17, 2011	March 24, 2011	$	0.12	$	1,415
Q2 2011	May 23, 2011	May 31, 2011		0.12		1,429
Q3 2011	August 19, 2011	August 26, 2011		0.12		1,365
Q4 2011	December 5, 2011	December 19, 2011		0.12		1,336
Total for 2011			$	0.48	$	5,545
Q1 2012	March 19, 2012	March 26, 2012	$	0.13	$	1,437
Q2 2012	June 18, 2012	June 25, 2012		0.13		1,439
Q3 2012	September 17, 2012	September 24, 2012		0.13		1,439
Q4 2012	December 10, 2012	December 17, 2012		0.13		1,447
Total for 2012			$	0.52	$	5,762
Q1 2013	March 18, 2013	March 25, 2013	$	0.14	$	1,569
Q2 2013	June 17, 2013	June 24, 2013		0.14		1,573
Q3 2013	September 16, 2013	September 23, 2013		0.14		1,575
Q4 2013	December 9, 2013	December 16, 2013		0.14		1,577
Total for 2013			$	0.56	$	6,294
Q1 2014	March 17, 2014	March 24, 2014		0.15		1,692
Q2 2014	June 16, 2014	June 23, 2014	$	0.15	$	1,695
Total for 2014			$	0.30	$	3,387

On August 4, 2014, the Company’s Board of Directors declared a quarterly cash dividend of $0.15 per share.  The dividend is payable, September 22, 2014 to shareholders of record as of September 15, 2014.

XML

GEOGRAPHIC INFORMATION - Net Sales and Long Lived Assets by Region (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Revenues from External Customers and Long-Lived Assets [Line Items]
Net Sales	$ 122,432	$ 105,834	$ 226,600	$ 190,784
Long Lived Assets	42,581		42,581		42,477
North America
Revenues from External Customers and Long-Lived Assets [Line Items]
Net Sales	102,895	89,843	185,664	162,111
Long Lived Assets	39,918		39,918		39,832
Foreign
Revenues from External Customers and Long-Lived Assets [Line Items]
Net Sales	19,537	15,991	40,936	28,673
Long Lived Assets	$ 2,663		$ 2,663		$ 2,645

XML

DERIVATIVE FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS

15. DERIVATIVE FINANCIAL INSTRUMENTS

The Company periodically enters into foreign currency exchange contracts designed to mitigate the impact of foreign currency risk.  Prior to November 2012, the Company had not instituted a formal foreign currency exchange policy.  All contracts entered into prior to this date are accounted for as undesignated hedges and, therefore, changes in fair value are recognized each period in other (income) expense, net in our condensed consolidated statements of income.  The fair value of the contracts is presented in accounts receivable in our condensed consolidated balance sheets.  At June 30, 2013, the Company had undesignated foreign currency exchange contracts with notional amounts of $6,500 which were directly offset by corresponding foreign currency exchange contracts.  These contracts expired over a period from September to November 2013.  The gains or losses were directly offset at June 30, 2013.

In November 2012, the Company adopted a formal foreign currency exchange policy.  Under this policy, for those foreign currency exchange contracts that qualify for hedge accounting treatment, changes in the fair value of such instruments are included in accumulated other comprehensive income (loss).  The Company also assesses, both at inception and on an ongoing basis, whether the derivatives that are used in the hedging transaction are highly effective in offsetting changes in cash flows of the hedged items.  For those foreign currency exchange contracts that do not qualify for hedge accounting treatment, changes in the fair value of such instruments are recognized each period in other (income) expense, net in our condensed consolidated statements of income.  In December 2012, the Company entered into foreign exchange currency contracts with notional values of $4,418 at June 30, 2014 and $10,200 at December 31, 2013 maturing from September 2013 to October 2014 that were considered cash flow hedges.  Changes in fair value of such cash flow hedges are recorded in accumulated other comprehensive income (loss) to the extent that the hedges are considered effective.  At June 30, 2014 and December 31, 2013, the net fair value of foreign currency exchange contracts was ($145)and ($291), respectively, which is included in accounts receivable or accounts payable in our condensed consolidated balance sheets, depending on the asset or liability position of the derivative.

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2014

Fair Value Disclosures [Abstract]

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

	June 30, 2014
	Level 1		Level 2		Level 3		Total
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total assets	$	—	$	—	$	—	$	—
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	145	$	—	$	145
Total liabilities	$	—	$	145	$	—	$	145

	December 31, 2013
	Level 1		Level 2		Level 3		Total
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total assets	$	—	$	—	$	—	$	—
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	291	$	—	$	291
Total liabilities	$	—	$	291	$	—	$	291

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Statement Of Other Comprehensive Income [Abstract]
NET INCOME	$ 3,387	$ 2,789	$ 5,687	$ 3,996
OTHER COMPREHENSIVE INCOME (LOSS):
Foreign currency translation adjustment	(95)	(117)	165	(365)
Derivative instrument and hedging activities	48	(199)	75	139
Reclassification from accumulated other comprehensive income (loss)	89		160
Total other comprehensive income (loss)	42	(316)	400	(226)
COMPREHENSIVE INCOME	3,429	2,473	6,087	3,770
NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS		112	66	233
COMPREHENSIVE INCOME ATTRIBUTABLE TO MILLER INDUSTRIES, INC.	$ 3,429	$ 2,585	$ 6,153	$ 4,003

XML

LONG-LIVED ASSETS

6 Months Ended

Jun. 30, 2014

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.

XML

BASIC AND DILUTED INCOME PER SHARE (Detail Textuals)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Earnings Per Share [Abstract]
Outstanding stock options included in the calculation of diluted EPS	53,000	85,000	61,000	101,000
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share

XML

DERIVATIVE FINANCIAL INSTRUMENTS (Detail Textuals) (Foreign currency exchange contracts, USD $) In Thousands, unless otherwise specified	Jun. 30, 2014 Accounts payable	Dec. 31, 2013 Accounts payable	Jun. 30, 2014 Cash Flow Hedging	Dec. 31, 2013 Cash Flow Hedging	Jun. 30, 2013 Undesignated
Derivative Instruments, Gain (Loss) [Line Items]
Notional amount			$ 4,418	$ 10,200	$ 6,500
Fair value of foreign currency exchange contracts included in account payable	$ (145)	$ (291)

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2014

Fair Value Disclosures [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

14.  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 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 15, Derivative Financial Instruments.

The following table presents the financial instruments measured at fair value on a recurring basis:
	June 30, 2014
	Level 1		Level 2		Level 3		Total
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total assets	$	—	$	—	$	—	$	—
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	145	$	—	$	145
Total liabilities	$	—	$	145	$	—	$	145

	December 31, 2013
	Level 1		Level 2		Level 3		Total
Current Assets
Derivative financial instruments
Foreign currency contracts	$	—	$	—	$	—	$	—
Total assets	$	—	$	—	$	—	$	—
Current Liabilities
Derivative financial instruments
Foreign currency contracts	$	—	$	291	$	—	$	291
Total liabilities	$	—	$	291	$	—	$	291