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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