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Superior Group of Companies, Inc. Reports Operating Results for the First Quarter Ended March 31, 2019

  • Net Sales increased 18 percent

  • 26th Consecutive Quarter with Sales Increase

SEMINOLE, Fla., April 25, 2019 (GLOBE NEWSWIRE) -- Superior Group of Companies, Inc. (SGC), today announced its first quarter operating results for 2019.

The Company announced that for the first quarter ended March 31, 2019, net sales increased 18.4 percent to $86.6 million, compared to first quarter 2018 net sales of $73.1 million. Pretax Income was $3.0 million compared to $3.3 million in 2018. Net income was $2.4 million or $0.16 per diluted share for both periods.

Michael Benstock, Chief Executive Officer, commented, “Our uniform segment sales were up 22% from last year’s first quarter, as a result of our acquisition of CID Resources. We’ve made substantial progress on the integration of our uniform businesses, both operationally and through product sourcing and sales channels. Our ERP and Web system integrations within our business are progressing on schedule and, once completed, will allow us to manage our entire uniform business more efficiently on a single platform. During this quarter we started the construction of our second manufacturing facility in Haiti which is scheduled for completion this summer. We also initiated our multi-year modernization initiative at our keystone distribution center in Eudora, Arkansas as well as our center supporting CID in Dallas. Our investments in these initiatives are designed to generate cost efficiencies, improve working capital usage, and allow us to better serve the needs of our customers.

We continue to see strong growth at BAMKO and The Office Gurus. During the first quarter, BAMKO, our Promotional Products segment, posted sales growth of 9 percent to $20.4 million compared to the first quarter of last year. The Office Gurus, our Remote Staffing segment, continues to perform to our expectations with quarterly net sales growth to outside customers of 20 percent over the comparable period.”

CONFERENCE CALL

Superior Group of Companies will hold a conference call on Thursday, April 25, 2019 at 2:00 p.m. Eastern Time to discuss the Company’s results. Interested individuals may join the teleconference by dialing (844) 861-5505 for U.S. dialers and (412) 317-6586 for International dialers. The Canadian Toll Free number is (866) 605-3852. Please ask to be joined into the Superior Group of Companies call. The live webcast and archived replay can also be accessed in the investor information section of the Company’s website at www.superiorgroupofcompanies.com.

A telephone replay of the teleconference will be available one hour after the end of the call through 2:00 p.m. Eastern Time on May 2, 2019. To access the replay, dial (877) 344-7529 in the United States or (412) 317-0088 from international locations. Canadian dialers can access the replay at (855) 669-9658. Please reference conference number 10130654 for all replay access.

About Superior Group of Companies, Inc. (SGC):

Superior Group of Companies, formerly Superior Group of Companies, established in 1920, is a combination of companies that help customers unlock the power of their brands by creating extraordinary brand experiences for employees and customers. It provides customized support for each of its divisions through its shared services model.

Fashion Seal Healthcare®, HPI and CID Resources are signature uniform brands of Superior Group of Companies. Each is one of America’s leading providers of uniforms and image apparel in the markets it serves. They specialize in innovative uniform program design, global manufacturing, and state-of-the-art distribution. Every day, more than 6 million Americans go to work wearing a uniform from Superior Group of Companies.

BAMKO®, Tangerine Promotions® and Public Identity® are signature promotional products and branded merchandise brands of Superior Group of Companies. They provide unique custom branding, design, sourcing, and marketing solutions to some of the world’s most successful brands.

The Office Gurus® is a global provider of custom call and contact center support. As a true strategic partner, The Office Gurus implements customized solutions for its customers in order to accelerate their growth and improve their customers’ service experiences.

SGC’s commitment to service, technology, quality and value-added benefits, as well as its financial strength and resources, provides unparalleled support for its customers’ diverse needs while embracing a “Customer 1st, Every Time!” philosophy and culture in all of its business segments.

Visit www.superiorgroupofcompanies.com for more information.

Contact:
Michael Attinella
Chief Financial Officer & Treasurer
(727) 803-7170

-OR-

Hala Elsherbini
Halliburton Investor Relations
(972) 458-8000

Comparative figures are as follows:

SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

THREE MONTHS ENDED MARCH 31,

(Unaudited)

(In thousands, except shares and per share data)

2019

2018

Net sales

$

86,552

$

73,087

Costs and expenses:

Cost of goods sold

56,284

48,212

Selling and administrative expenses

25,863

21,182

Other periodic pension costs

259

96

Interest expense

1,170

277

83,576

69,767

Income before taxes on income

2,976

3,320

Income tax expense

600

870

Net income

$

2,376

$

2,450

Weighted average number of shares outstanding during the period

(Basic)

14,927,341

14,821,659

(Diluted)

15,262,654

15,457,629

Per Share Data:

Basic

Net income

$

0.16

$

0.17

Diluted

Net income

$

0.16

$

0.16

Cash dividends per common share

$

0.1000

$

0.0950

SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and par value data)

ASSETS

March 31,

2019

December 31,

(Unaudited)

2018

CURRENT ASSETS:

Cash and cash equivalents

$

6,824

$

5,362

Accounts receivable, less allowance for doubtful accounts

of $2,004 and $2,042, respectively

63,610

64,017

Accounts receivable - other

1,431

1,744

Inventories

65,753

67,301

Contract assets

47,359

49,236

Prepaid expenses and other current assets

11,488

9,552

TOTAL CURRENT ASSETS

196,465

197,212

PROPERTY, PLANT AND EQUIPMENT, NET

29,388

28,769

OPERATING LEASE RIGHT-OF-USE ASSETS

4,581

-

OTHER INTANGIBLE ASSETS, NET

65,389

66,312

GOODWILL

33,955

33,961

OTHER ASSETS

9,796

8,832

$

339,574

$

335,086

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:

Accounts payable

$

24,802

$

24,685

Other current liabilities

15,703

14,767

Current portion of long-term debt

15,286

6,000

Current portion of acquisition-related contingent liabilities

941

941

TOTAL CURRENT LIABILITIES

56,732

46,393

LONG-TERM DEBT

101,931

111,522

LONG-TERM PENSION LIABILITY

8,643

8,705

LONG-TERM ACQUISITION-RELATED CONTINGENT LIABILITIES

5,622

5,422

OPERATING LEASE LIABILITIES

2,866

-

DEFERRED TAX LIABILITY

7,365

8,475

OTHER LONG-TERM LIABILITIES

4,690

3,648

COMMITMENTS AND CONTINGENCIES (NOTE 5)

SHAREHOLDERS' EQUITY:

Preferred stock, $.001 par value - authorized 300,000 shares (none issued)

-

-

Common stock, $.001 par value - authorized 50,000,000 shares, issued and

outstanding - 15,229,775 and 15,202,387, respectively.

15

15

Additional paid-in capital

56,536

55,859

Retained earnings

102,945

103,032

Accumulated other comprehensive income (loss), net of tax:

Pensions

(7,426)

(7,673)

Cash flow hedges

108

113

Foreign currency translation adjustment

(453)

(425)

TOTAL SHAREHOLDERS' EQUITY

151,725

150,921

$

339,574

$

335,086

SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31,

(Unaudited)

(In thousands)

2019

2018

CASH FLOWS FROM OPERATING ACTIVITIES

Net income

$

2,376

$

2,450

Adjustments to reconcile net income

to net cash (used in) provided by operating activities:

Depreciation and amortization

2,060

1,626

Provision for bad debts - accounts receivable

138

157

Share-based compensation expense

481

1,052

Deferred income tax benefit (provision)

(1,182

)

162

Gain on sale of property, plant and equipment

(3

)

-

Change in fair value of acquisition-related contingent liabilities

201

209

Changes in assets and liabilities:

Accounts receivable - trade

309

2,147

Accounts receivable - other

312

(259

)

Contract assets

1,876

(3,780

)

Inventories

1,522

3,742

Prepaid expenses and other current assets

(2,197

)

27

Other assets

(1,503

)

(1,564

)

Accounts payable and other current liabilities

(12

)

(7,132

)

Long-term pension liability

262

97

Other long-term liabilities

1,099

450

Net cash provided by (used in) operating activities

5,739

(616

)

CASH FLOWS FROM INVESTING ACTIVITIES

Additions to property, plant and equipment

(1,723

)

(1,055

)

Proceeds from disposals of property, plant and equipment

3

-

Net cash used in investing activities

(1,720

)

(1,055

)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from long-term debt

54,856

31,657

Repayment of long-term debt

(55,161

)

(24,642

)

Payment of cash dividends

(1,515

)

(1,402

)

Payment of acquisition-related contingent liability

-

(2,000

)

Proceeds received on exercise of stock options

210

257

Tax benefit from vesting of acquisition-related restricted stock

30

105

Tax withholding on exercise of stock rights

-

(17

)

Common stock reacquired and retired

(992

)

-

Net cash (used in) provided by financing activities

(2,572

)

3,958

Effect of currency exchange rates on cash

15

25

Net increase in cash and cash equivalents

1,462

2,312

Cash and cash equivalents balance, beginning of year

5,362

8,130

Cash and cash equivalents balance, end of period

$

6,824

$

10,442