Superior Uniform Group, Inc. Reports Second Quarter Operating Results
July 21 2016 - 6:00AM
Superior Uniform Group, Inc. (NASDAQ:SGC), manufacturer of
uniforms, career apparel, accessories and promotional products,
today announced that for the second quarter ended June 30, 2016,
net sales increased 19.5 percent to $64.7 million compared with
2015 second quarter net sales of $54.1 million. Net income for
second quarter 2016 was $3.1 million, or $0.21 per diluted share,
compared with $3.6 million, or $0.25 per diluted share, reported
for the quarter ended June 30, 2015.
For the six months ended June 30, 2016, net
sales increased 22.1 percent to $122.6 million compared with net
sales of $100.5 million for the six months ended June 30, 2015. Net
income for the six months ended June 30, 2016 was $5.3 million, or
$0.36 per diluted share, compared with $5.7 million, or $0.39 per
diluted share reported for the six months ended June 30,
2015. As a result of the BAMKO acquisition, net income was
negatively impacted by $0.2 million in pre-tax acquisition related
expenses in the second quarter of 2016 and $1.1 million in the
first six months of 2016.
Michael Benstock, Chief Executive Officer,
commented, “We are pleased to report a 19.5 percent increase in net
sales in the second quarter. The increase in net sales for the
second quarter came from net sales at BAMKO, which we acquired in
March of this year, and from The Office Gurus, our remote staffing
segment. Net sales in our uniforms segment leveled off in the
second quarter following an exceptionally strong first quarter of
2016. Additionally, BAMKO has come out of the gate very strong,
generating net sales of $9.8 million in the 2016 second quarter.
This represents an increase of more than 88 percent versus the same
period in 2015. We are very pleased with BAMKO and continue to work
to achieve operational and sales synergies between the two
organizations. The Office Gurus continues to grow at a very healthy
rate with net sales to outside customers up 25.8 percent over the
second quarter of 2015. At the end of the second quarter, we
completed the building project in El Salvador and moved into a
brand new, state-of-the-art, call center facility that nearly
triples our capacity there. In addition to the acquisition of BAMKO
and the new building in El Salvador, we continue to invest in our
uniform business. Our new sewing factory in Haiti is progressing
nicely and on schedule with our implementation plan. We expect it
to achieve breakeven status by the end of 2016.
“Our financial position remains strong, and we
were able to pay down outstanding debt by $4.7 million in the
second quarter of 2016. This financial strength positions us well
to continue to invest in our businesses and to take advantage of
opportunities as they arise.”
CONFERENCE CALL
Superior Uniform Group will hold a conference
call on Thursday, July 21, 2016 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
Uniform Group call. The live webcast and archived replay can also
be accessed in the investor information section of the Company’s
website at www.SuperiorUniformGroup.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 July 28, 2016. 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 10088860 for all
replay access.
About Superior Uniform Group, Inc.
Superior Uniform Group® (NASDAQ:SGC), established in 1920, is
one of America’s foremost providers of fine uniforms and image
apparel. Headquartered in Seminole, Fla., Superior Uniform Group
manages award-winning uniform apparel programs for major
corporations nationwide. Leaders in innovative uniform program
design, global manufacturing, and state-of-the-art distribution,
Superior Uniform Group helps companies achieve a more professional
appearance and better communicate their brands – particularly those
in healthcare, private security, retail, hospitality,
transportation and food service industries.
The company’s commitment to service, technology, quality and
value-added benefits, as well as its financial strength and
resources, support customers’ diverse needs while embracing a
“Customer 1st, Every Time!” philosophy and culture. Superior
Uniform Group sells its wide range of products through its
signature brands Superior I.D.™, Fashion Seal Healthcare®
and HPI Direct®. Superior Uniform Group is also the
parent company for The Office Gurus®, which provides call center
and BPO solutions to a variety of customers, and BAMKO®, its
innovative promotional products company that provides custom
branding solutions to some of the nation’s strongest
brands.
For more information, call (800) 727-8643 or visit
www.SuperiorUniformGroup.com.
Statements contained in this press release which
are not historical facts may constitute forward-looking statements
as that term is defined in the Private Securities Litigation Reform
Act of 1995. All forward-looking statements are subject to risks
and uncertainties, including without limitation, those identified
in the Company’s SEC filings, which could cause actual results to
differ from those projected.
Comparative figures are as follows:
|
SUPERIOR UNIFORM GROUP, INC. AND
SUBSIDIARIES |
|
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016 |
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
$ |
64,660,000 |
$ |
54,116,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
Cost of goods sold |
|
|
|
|
42,897,000 |
|
35,585,000 |
|
|
|
Selling and administrative expenses |
|
|
|
16,956,000 |
|
13,008,000 |
|
|
|
Interest expense |
|
|
|
|
192,000 |
|
129,000 |
|
|
|
|
|
|
|
|
|
|
60,045,000 |
|
48,722,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes on income |
|
|
|
|
4,615,000 |
|
5,394,000 |
|
|
Income tax expense |
|
|
|
|
1,540,000 |
|
1,770,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
|
|
|
$ |
3,075,000 |
$ |
3,624,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of shares outstanding during the period |
|
|
|
|
|
|
|
|
|
|
|
(Basic) |
|
14,120,617 |
|
13,730,646 |
|
|
|
|
|
|
|
|
(Diluted) |
|
14,957,469 |
|
14,577,342 |
|
|
Per Share
Data: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
|
|
$ |
0.22 |
$ |
0.26 |
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
|
|
$ |
0.21 |
$ |
0.25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income, net of tax: |
|
|
|
|
|
|
|
|
|
Defined
benefit pension plans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recognition
of net losses included in |
|
|
|
|
|
|
|
|
|
|
net
periodic pension costs |
|
|
|
171,000 |
|
129,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recognition
of settlement loss included |
|
|
|
|
|
|
|
|
|
|
in net
periodic pension costs |
|
|
|
33,000 |
|
201,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on
cash flow hedging activities |
|
|
|
21,000 |
|
21,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency translation adjustment |
|
|
|
173,000 |
|
- |
|
|
Other
comprehensive income |
|
|
|
|
398,000 |
|
351,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
|
|
|
$ |
3,473,000 |
$ |
3,975,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per common share |
|
|
|
$ |
0.0825 |
$ |
0.075 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPERIOR UNIFORM GROUP, INC. AND
SUBSIDIARIES |
|
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
(Continued) |
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016 |
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
$ |
122,628,000 |
$ |
|
100,463,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
Cost of goods sold |
|
|
|
|
80,844,000 |
|
|
66,136,000 |
|
|
|
|
Selling and administrative expenses |
|
|
|
33,419,000 |
|
|
25,445,000 |
|
|
|
|
Interest expense |
|
|
|
|
340,000 |
|
|
265,000 |
|
|
|
|
|
|
|
|
|
|
|
114,603,000 |
|
|
91,846,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes on income |
|
|
|
|
8,025,000 |
|
|
8,617,000 |
|
|
|
Income tax expense |
|
|
|
|
2,690,000 |
|
|
2,950,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
|
|
|
$ |
5,335,000 |
$ |
|
5,667,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of shares outstanding during the period |
|
|
|
|
|
|
|
|
|
|
|
(Basic) |
|
14,023,840 |
|
|
13,657,784 |
|
|
|
|
|
|
|
|
|
(Diluted) |
|
14,813,064 |
|
|
14,562,713 |
|
|
|
Per Share
Data: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
|
|
$ |
0.38 |
$ |
|
0.41 |
|
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
|
|
$ |
0.36 |
$ |
|
0.39 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income, net of tax: |
|
|
|
|
|
|
|
|
|
Defined
benefit pension plans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recognition
of net losses included in |
|
|
|
|
|
|
|
|
|
|
net
periodic pension costs |
|
|
|
342,000 |
|
|
257,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recognition
of settlement loss included |
|
|
|
|
|
|
|
|
|
|
in net
periodic pension costs |
|
|
|
198,000 |
|
|
201,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain (loss)
on cash flow hedging activities |
|
|
|
6,000 |
|
|
(1,000 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency translation adjustment |
|
|
|
294,000 |
|
|
- |
|
|
|
Other
comprehensive income |
|
|
|
|
840,000 |
|
|
457,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
|
|
|
$ |
6,175,000 |
$ |
|
6,124,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per common share |
|
|
|
$ |
0.165 |
$ |
|
0.15 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES |
|
CONSOLIDATED BALANCE SHEETS |
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
|
|
|
|
|
|
|
|
|
2016 |
|
|
December 31, |
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
2015 |
|
|
CURRENT
ASSETS: |
|
|
|
|
|
|
|
Cash
and cash equivalents |
|
|
$ |
|
4,735,000 |
|
$ |
|
1,036,000 |
|
|
|
Accounts receivable, less allowance for doubtful accounts |
|
|
|
|
|
|
of $1,100,000 and $848,000, respectively |
|
|
|
37,091,000 |
|
|
|
29,914,000 |
|
|
|
Accounts receivable - other |
|
|
|
|
2,137,000 |
|
|
|
3,262,000 |
|
|
|
Prepaid expenses and other current assets |
|
|
11,150,000 |
|
|
|
6,214,000 |
|
|
|
Inventories* |
|
|
|
|
|
63,161,000 |
|
|
|
63,573,000 |
|
|
TOTAL CURRENT ASSETS |
|
|
|
|
118,274,000 |
|
|
|
103,999,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
PROPERTY,
PLANT AND EQUIPMENT, NET |
|
|
27,090,000 |
|
|
|
22,524,000 |
|
|
OTHER
INTANGIBLE ASSETS, NET |
|
|
|
24,428,000 |
|
|
|
14,222,000 |
|
|
GOODWILL |
|
|
|
|
|
|
11,481,000 |
|
|
|
4,135,000 |
|
|
DEFERRED
INCOME TAXES |
|
|
|
|
4,760,000 |
|
|
|
4,980,000 |
|
|
OTHER
ASSETS |
|
|
|
|
|
2,392,000 |
|
|
|
1,871,000 |
|
|
|
|
|
|
|
|
$ |
|
188,425,000 |
|
$ |
|
151,731,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES: |
|
|
|
|
|
|
|
|
Accounts payable |
|
|
|
$ |
|
15,397,000 |
|
$ |
|
11,775,000 |
|
|
|
Other current liabilities |
|
|
|
|
7,883,000 |
|
|
|
8,307,000 |
|
|
|
Current portion of long-term debt |
|
|
|
6,429,000 |
|
|
|
2,750,000 |
|
|
|
Current portion of acquisition-related contigent liabilities |
|
|
1,969,000 |
|
|
|
1,787,000 |
|
|
TOTAL CURRENT LIABILITIES |
|
|
|
31,678,000 |
|
|
|
24,619,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM
DEBT, net of issuance costs |
|
|
|
36,898,000 |
|
|
|
21,131,000 |
|
|
LONG-TERM
PENSION LIABILITY |
|
|
|
8,347,000 |
|
|
|
8,925,000 |
|
|
LONG-TERM
ACQUISITION-RELATED CONTINGENT LIABILITIES |
|
|
7,361,000 |
|
|
|
3,866,000 |
|
|
OTHER
LONG-TERM LIABILITIES |
|
|
|
540,000 |
|
|
|
500,000 |
|
|
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
- 14,407,920 and 13,917,465, respectively. |
|
|
14,000 |
|
|
|
14,000 |
|
|
|
Additional
paid-in capital |
|
|
|
|
40,982,000 |
|
|
|
33,806,000 |
|
|
|
Retained
earnings |
|
|
|
|
|
68,287,000 |
|
|
|
65,392,000 |
|
|
|
Accumulated
other comprehensive income (loss), net of tax: |
|
|
|
|
|
|
|
Pensions |
|
|
|
|
|
(5,908,000 |
) |
|
|
(6,448,000 |
) |
|
|
|
Cash flow
hedges |
|
|
|
|
(68,000 |
) |
|
|
(74,000 |
) |
|
|
|
Foreign
currency translation adjustment |
|
|
294,000 |
|
|
|
- |
|
|
TOTAL
SHAREHOLDERS' EQUITY |
|
|
|
103,601,000 |
|
|
|
92,690,000 |
|
|
|
|
|
|
|
|
$ |
|
188,425,000 |
|
$ |
|
151,731,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
*
Inventories consist of the following: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
|
|
|
|
|
|
|
|
|
2016 |
|
|
December 31, |
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
2015 |
|
|
Finished goods |
|
|
|
$ |
|
49,649,000 |
|
$ |
|
48,206,000 |
|
|
Work in process |
|
|
|
|
|
955,000 |
|
|
|
860,000 |
|
|
Raw materials |
|
|
|
|
|
12,557,000 |
|
|
|
14,507,000 |
|
|
|
|
|
|
|
|
$ |
|
63,161,000 |
|
$ |
|
63,573,000 |
|
|
|
|
|
|
|
|
|
|
|
|
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SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
Six Months Ended June 30, |
(Unaudited) |
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2016 |
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2015 |
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CASH FLOWS FROM OPERATING ACTIVITIES |
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Net income |
$ |
|
5,335,000 |
|
$ |
|
5,667,000 |
|
Adjustments to
reconcile net income |
|
|
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|
to net cash provided by
operating activities: |
|
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|
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|
Depreciation and
amortization |
|
|
2,333,000 |
|
|
|
1,890,000 |
|
|
Provision for bad debts
- accounts receivable |
|
|
180,000 |
|
|
|
211,000 |
|
|
Share-based
compensation expense |
|
|
983,000 |
|
|
|
964,000 |
|
|
Deferred income tax
provision (benefit) |
|
|
(69,000 |
) |
|
|
(881,000 |
) |
|
Loss on sales of
property, plant and equipment |
|
|
- |
|
|
|
12,000 |
|
|
Accretion of
acquisition-related contingent liability |
|
|
81,000 |
|
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|
65,000 |
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Changes in assets and
liabilities, net of acquisition of business: |
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Accounts receivable -
trade |
|
|
(2,181,000 |
) |
|
|
(2,079,000 |
) |
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Accounts receivable -
other |
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|
1,125,000 |
|
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|
892,000 |
|
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Inventories |
|
|
653,000 |
|
|
|
(2,493,000 |
) |
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Prepaid expenses and
other current assets |
|
|
(1,648,000 |
) |
|
|
(1,419,000 |
) |
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|
Other assets |
|
|
(353,000 |
) |
|
|
(41,000 |
) |
|
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Accounts
payable |
|
|
2,238,000 |
|
|
|
4,386,000 |
|
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Other current
liabilities |
|
|
(1,350,000 |
) |
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|
(2,233,000 |
) |
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|
Long-term pension
liability |
|
|
259,000 |
|
|
|
567,000 |
|
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Other long-term
liabilities |
|
|
40,000 |
|
|
|
40,000 |
|
|
Net cash provided by
operating activities |
|
|
7,626,000 |
|
|
|
5,548,000 |
|
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CASH FLOWS FROM INVESTING ACTIVITIES |
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|
Additions to property,
plant and equipment |
|
|
(5,527,000 |
) |
|
|
(2,099,000 |
) |
|
Acquisition of
business, net of acquired cash |
|
|
(15,252,000 |
) |
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|
- |
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|
Net cash used in
investing activities |
|
|
(20,779,000 |
) |
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|
(2,099,000 |
) |
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CASH FLOWS FROM FINANCING ACTIVITIES |
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Proceeds from long-term
debt |
|
|
90,514,000 |
|
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|
25,040,000 |
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Repayment of long-term
debt |
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|
(71,138,000 |
) |
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|
(26,638,000 |
) |
|
Payment of cash
dividends |
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|
(2,270,000 |
) |
|
|
(2,006,000 |
) |
|
Payment of contingent
liability |
|
|
(1,800,000 |
) |
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|
- |
|
|
Proceeds received on
exercise of stock options |
|
|
781,000 |
|
|
|
1,383,000 |
|
|
Excess tax benefit from
exercise of stock options and SARS |
|
|
683,000 |
|
|
|
588,000 |
|
|
|
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|
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Net cash provided by
(used in) financing activities |
|
|
16,770,000 |
|
|
|
(1,633,000 |
) |
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Effect of currency
exchange rates on cash |
|
|
82,000 |
|
|
|
- |
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|
Net increase in cash
and cash equivalents |
|
|
3,699,000 |
|
|
|
1,816,000 |
|
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Cash and cash equivalents balance, beginning of year |
|
|
1,036,000 |
|
|
|
4,586,000 |
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Cash and cash equivalents balance, end of period |
$ |
|
4,735,000 |
|
$ |
|
6,402,000 |
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Contact:
Andrew D. Demott, Jr.
COO, CFO & Treasurer
(727) 803-7135
OR
Hala Elsherbini, Halliburton Investor Relations
(972) 458-8000
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