Superior Group of Companies, Inc. Reports Operating Results for the Second Quarter June 30, 2019
July 30 2019 - 6:10AM
Superior Group of Companies, Inc. (NASDAQ: SGC), today announced
its second quarter operating results for 2019.
The Company announced that for the second
quarter ended June 30, 2019, net sales increased 12.0 percent to
$92.3 million, compared to second quarter 2018 net sales of $82.4
million. Pretax Income was $3.7 million compared to $5.1 million in
2018. Net income was $2.8 million or $0.18 per diluted share,
compared to $0.25 per diluted share in 2018.
Michael Benstock, Chief Executive Officer,
commented, “Across all of our segments, we continue to perform well
in a challenging business environment. We’re currently investing in
our companies and making the organizational changes necessary to
support our current business and prepare for our next level of
growth; all while realizing increased sales for our 27th
consecutive quarter.
Our uniform segment sales were up 7.7% from last
year, as we reached the first anniversary of our acquisition of CID
Resources. We’re making good progress on the integration of
our uniform businesses enabling operational efficiencies, improved
resource alignment, product sourcing, and sales channels.
Technology upgrades are moving forward in our distribution centers
in Arkansas and Texas, and construction continues on our second
manufacturing facility in Haiti. Our investments in these
initiatives are designed to generate cost efficiencies, improve
working capital usage, and better serve the needs of our
customers.
We continue to see strong growth at BAMKO and
The Office Gurus. During the second quarter, BAMKO, our promotional
products segment posted sales growth of 24.9% to $23.7 million
compared to the second 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 11.6% over
the comparable period.” CONFERENCE
CALL
Superior Group of Companies will hold a
conference call on Tuesday, July 30, 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 August 13, 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
10132243 for all replay access.
About Superior Group of Companies, Inc.
(SGC):
Superior Group of Companies™, formerly Superior
Uniform Group, 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 |
|
Hala Elsherbini |
Chief Financial Officer & Treasurer
|
OR |
Halliburton Investor Relations |
(727) 803-7170 |
|
(972) 458-8000 |
Comparative figures are as follows:
|
SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES |
|
|
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED JUNE 30, |
|
|
(Unaudited) |
|
|
(In thousands, except shares and per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
$ |
92,270 |
$ |
82,392 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
Cost of goods sold |
|
|
|
|
59,927 |
|
53,114 |
|
|
|
Selling and administrative expenses |
|
|
|
26,885 |
|
23,327 |
|
|
|
Other periodic pension costs |
|
|
|
|
547 |
|
96 |
|
|
|
Interest expense |
|
|
|
|
1,259 |
|
758 |
|
|
|
|
|
|
|
|
|
|
88,618 |
|
77,295 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes on income |
|
|
|
|
3,652 |
|
5,097 |
|
|
Income tax expense |
|
|
|
|
871 |
|
1,280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
|
$ |
2,781 |
$ |
3,817 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding during the period |
|
|
|
|
|
|
(Basic) |
|
|
|
|
|
14,952,802 |
|
14,956,221 |
|
|
|
(Diluted) |
|
|
|
|
|
15,287,357 |
|
15,559,404 |
|
|
Per Share
Data: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
$ |
0.19 |
$ |
0.26 |
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
$ |
0.18 |
$ |
0.25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per common share |
|
|
|
$ |
0.100 |
$ |
0.095 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES |
|
|
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SIX MONTHS ENDED JUNE 30, |
|
|
(Unaudited) |
|
|
(In thousands, except shares and per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
$ |
178,822 |
$ |
155,479 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
Cost of goods sold |
|
|
|
|
116,211 |
|
101,326 |
|
|
|
Selling and administrative expenses |
|
|
|
52,748 |
|
44,509 |
|
|
|
Other periodic pension costs |
|
|
|
|
806 |
|
192 |
|
|
|
Interest expense |
|
|
|
|
2,429 |
|
1,035 |
|
|
|
|
|
|
|
|
|
|
172,194 |
|
147,062 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes on income |
|
|
|
|
6,628 |
|
8,417 |
|
|
Income tax expense |
|
|
|
|
1,471 |
|
2,150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
|
$ |
5,157 |
$ |
6,267 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding during the period |
|
|
|
|
|
|
(Basic) |
|
|
|
|
|
14,940,072 |
|
14,888,940 |
|
|
|
(Diluted) |
|
|
|
|
|
15,275,006 |
|
15,508,517 |
|
|
Per Share
Data: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
$ |
0.35 |
$ |
0.42 |
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
$ |
0.34 |
$ |
0.40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per common share |
|
|
|
$ |
0.20 |
$ |
0.19 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES |
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
|
(Unaudited) |
|
(In thousands, except share and par value data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
December 31, |
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
CURRENT
ASSETS: |
|
|
|
|
|
|
|
Cash and cash
equivalents |
|
|
$ |
8,267 |
|
$ |
5,362 |
|
|
|
Accounts
receivable, less allowance for doubtful accounts |
|
|
|
|
|
|
of $2,141
and $2,042, respectively |
|
|
|
70,927 |
|
|
64,017 |
|
|
|
Accounts
receivable - other |
|
|
|
1,463 |
|
|
1,744 |
|
|
|
Inventories |
|
|
|
|
63,370 |
|
|
67,301 |
|
|
|
Contract
assets |
|
|
|
|
43,674 |
|
|
49,236 |
|
|
|
Prepaid expenses
and other current assets |
|
|
12,090 |
|
|
9,552 |
|
|
|
TOTAL CURRENT
ASSETS |
|
|
|
|
199,791 |
|
|
197,212 |
|
|
|
|
|
|
|
|
|
|
|
|
|
PROPERTY, PLANT
AND EQUIPMENT, NET |
|
|
31,448 |
|
|
28,769 |
|
|
OPERATING LEASE
RIGHT-OF-USE ASSETS |
|
|
4,716 |
|
|
- |
|
|
INTANGIBLE ASSETS,
NET |
|
|
|
64,437 |
|
|
66,312 |
|
|
GOODWILL |
|
|
|
|
|
36,321 |
|
|
33,961 |
|
|
OTHER ASSETS |
|
|
|
|
10,299 |
|
|
8,832 |
|
|
TOTAL ASSETS |
|
|
|
$ |
347,012 |
|
$ |
335,086 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES: |
|
|
|
|
|
|
|
|
|
Accounts
payable |
|
|
|
$ |
25,903 |
|
$ |
24,685 |
|
|
|
Other current
liabilities |
|
|
|
15,375 |
|
|
14,767 |
|
|
|
Current portion of
long-term debt |
|
|
|
15,286 |
|
|
6,000 |
|
|
|
Current portion of
acquisition-related contingent liabilities |
|
2,212 |
|
|
941 |
|
|
|
TOTAL CURRENT
LIABILITIES |
|
|
|
58,776 |
|
|
46,393 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM
DEBT |
|
|
|
|
108,035 |
|
|
111,522 |
|
|
LONG-TERM PENSION
LIABILITY |
|
|
|
8,532 |
|
|
8,705 |
|
|
LONG-TERM
ACQUISITION-RELATED CONTINGENT LIABILITIES |
|
3,605 |
|
|
5,422 |
|
|
LONG-TERM
OPERATING LEASE LIABILITIES |
|
|
2,864 |
|
|
- |
|
|
DEFERRED TAX
LIABILITY |
|
|
|
6,730 |
|
|
8,475 |
|
|
OTHER LONG-TERM
LIABILITIES |
|
|
|
4,350 |
|
|
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 -
15,255,694 and 15,202,387, respectively. |
|
15 |
|
|
15 |
|
|
|
Additional paid-in
capital |
|
|
|
57,166 |
|
|
55,859 |
|
|
|
Retained
earnings |
|
|
|
|
104,165 |
|
|
103,032 |
|
|
|
Accumulated other
comprehensive income (loss), net of tax: |
|
|
|
|
|
|
|
Pensions |
|
|
|
|
(6,924 |
) |
|
(7,673 |
) |
|
|
|
Cash flow
hedges |
|
|
|
102 |
|
|
113 |
|
|
|
|
Foreign currency
translation adjustment |
|
(404 |
) |
|
(425 |
) |
|
TOTAL
SHAREHOLDERS' EQUITY |
|
|
|
154,120 |
|
|
150,921 |
|
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY |
$ |
347,012 |
|
$ |
335,086 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES |
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|
SIX MONTHS ENDED JUNE 30, |
|
(Unaudited) |
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES |
|
|
|
|
|
Net income |
|
|
$ |
5,157 |
|
$ |
6,267 |
|
|
Adjustments to reconcile net income |
|
|
|
|
|
to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
4,211 |
|
|
3,646 |
|
|
|
Provision for bad debts - accounts receivable |
|
361 |
|
|
323 |
|
|
|
Share-based compensation expense |
|
1,032 |
|
|
1,490 |
|
|
|
Deferred income tax benefit (provision) |
|
(1,979 |
) |
|
302 |
|
|
|
Gain on sale of property, plant and equipment |
|
(3 |
) |
|
- |
|
|
|
Change in fair value of acquisition-related contingent
liabilities |
|
417 |
|
|
(840 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Changes in assets and liabilities, net of acquisition of
business: |
|
|
|
|
|
|
|
Accounts receivable - trade |
|
(7,230 |
) |
|
(3,492 |
) |
|
|
|
Accounts receivable - other |
|
280 |
|
|
(674 |
) |
|
|
|
Contract assets |
|
|
5,562 |
|
|
(972 |
) |
|
|
|
Inventories |
|
|
2,113 |
|
|
2,953 |
|
|
|
|
Prepaid expenses and other current assets |
|
(2,625 |
) |
|
242 |
|
|
|
|
Other assets |
|
|
(2,102 |
) |
|
(1,827 |
) |
|
|
|
Accounts payable and other current liabilities |
|
(14 |
) |
|
(7,368 |
) |
|
|
|
Long-term pension liability |
|
812 |
|
|
195 |
|
|
|
|
Other long-term liabilities |
|
759 |
|
|
(497 |
) |
|
|
Net cash provided by (used in) operating activities |
|
6,751 |
|
|
(252 |
) |
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES |
|
|
|
|
|
|
Additions to property, plant and equipment |
|
(4,979 |
) |
|
(2,414 |
) |
|
|
Proceeds from disposals of property, plant and equipment |
|
3 |
|
|
- |
|
|
|
Acquisition of businesses, net of acquired cash |
|
- |
|
|
(85,597 |
) |
|
|
Net cash used in investing activities |
|
(4,976 |
) |
|
(88,011 |
) |
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES |
|
|
|
|
|
|
Proceeds from long-term debt |
|
94,466 |
|
|
146,157 |
|
|
|
Repayment of long-term debt |
|
(88,667 |
) |
|
(56,289 |
) |
|
|
Payment of cash dividends |
|
|
(3,023 |
) |
|
(2,827 |
) |
|
|
Payment of acquisition-related contingent liability |
|
(961 |
) |
|
(3,033 |
) |
|
|
Proceeds received on exercise of stock options |
|
280 |
|
|
405 |
|
|
|
Tax benefit from vesting of acquisition-related restricted
stock |
|
30 |
|
|
105 |
|
|
|
Tax withholding on exercise of stock rights |
|
- |
|
|
(17 |
) |
|
|
Common stock reacquired and retired |
|
(1,036 |
) |
|
- |
|
|
Net cash provided
by financing activities |
|
1,089 |
|
|
84,501 |
|
|
|
|
|
|
|
|
|
|
|
|
Effect of currency
exchange rates on cash |
|
41 |
|
|
(204 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents |
|
2,905 |
|
|
(3,966 |
) |
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents balance, beginning of year |
|
5,362 |
|
|
8,130 |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents balance, end of period |
$ |
8,267 |
|
$ |
4,164 |
|
|
|
|
|
|
|
|
|
|
|
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