Superior Uniform Group, Inc. Reports First Quarter Operating Results
May 02 2018 - 9:02AM
Superior Uniform Group, Inc. (NASDAQ:SGC), manufacturer of
uniforms, career apparel and accessories, today announced that for
the first quarter ended March 31, 2018, net sales increased 19.8
percent to $73.1 million compared with 2017 first quarter net sales
of $61.0 million. Net income for the 2018 first quarter was
$2.5 million, or $0.16 per diluted share, compared with $3.8
million, or $0.26 per diluted share, reported for the quarter ended
March 31, 2017. Net income for the first quarter of
2017 included a pre-tax gain of $1.0 million related to the sale of
the Company’s former call center building in San Salvador. This
gain resulted in an increase in earnings per share (diluted) in the
first quarter of 2017 of approximately $0.05.
Michael Benstock, Chief Executive Officer,
commented, “Our results for the first quarter were mixed across our
various segments. Uniform segment net sales were down
slightly at $48.1 million versus $48.3 million. While
organic growth in our uniform segment lagged in the first quarter,
our results demonstrate our diversified approach and our ability to
maintain discipline while navigating a competitive market
environment.
“Promotional Products net sales were up 109
percent with most of this increase coming from our two acquisitions
completed in the latter part of 2017. We’re making solid progress
on integration efforts, leveraging our shared services model as
well as capitalizing on cross-selling opportunities across our
business. The Promotional Products segment reported a pre-tax loss
of approximately $0.6 million for the quarter in comparison to
pre-tax income of $0.4 million in the first quarter of 2017.
This loss is attributed to the December acquisition of Tangerine
and the nature of their business. Tangerine generally reports
lower sales in the first and fourth quarter each year with a more
significant portion of their annual sales volume coming in the
second and third quarters. We are still in the early stages
of integrating this recent acquisition, and we still expect the
results from this acquisition to be accretive for the full year in
2018.
“The Office Gurus, our Remote Staffing segment,
had a tremendous quarter with net sales to outside customers
increasing by $2.6 million or 68.8 percent as they continue to land
new customers and to grow with existing customers.”
CONFERENCE CALL
Superior Uniform Group will hold a conference
call on Wednesday, May 2, 2018 at 10:00 a.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 May 9, 2018. 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
10119178 for all replay access.
About Superior Uniform Group,
Inc.Superior Uniform Group® (NASDAQ:SGC), established
in 1920, is a provider of a wide range of award winning
products and services. It provides customized support for each of
its divisions through its shared services model.
Fashion Seal Healthcare®, Superior I.D™, and HPI
Direct® are signature uniform brands of
Superior Uniform Group®. Each is one of America’s foremost
providers of fine uniforms and image apparel in its markets. They
are leaders in innovative uniform program design, global
manufacturing, and state-of-the-art distribution. These brands
help their customers achieve a more professional appearance
and better communicate their own brands. More
than 5 million Americans are smartly outfitted with a
Superior uniform each workday.
BAMKO® is one of the
nation’s largest full-service promotional
products companies. It provides 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.
Superior’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.
Forward-Looking StatementsStatements contained
in this press release, which are not historical facts, such as
statements with respect to the results from Superior’s recent
acquisitions and its expected growth, 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.
For more information, call (800) 727-8643 or
visit www.SuperiorUniformGroup.com.
Contact:Andrew D. Demott, Jr.COO, CFO & Treasurer(727)
803-7135
OR
Hala Elsherbini, Halliburton Investor Relations(972)
458-8000
Comparative figures are as follows:
|
|
SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES |
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED MARCH 31, |
|
(Unaudited) |
|
(In thousands, except shares and per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018 |
|
|
2017 |
|
|
|
|
|
|
|
|
|
|
Net sales |
|
|
$ |
73,087 |
|
$ |
60,987 |
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
Cost of goods sold |
|
|
|
48,212 |
|
|
38,773 |
|
Selling and administrative expenses |
|
|
|
21,182 |
|
|
17,429 |
|
Other periodic pension costs |
|
|
|
96 |
|
|
214 |
|
Interest expense |
|
|
|
277 |
|
|
184 |
|
|
|
|
|
69,767 |
|
|
56,600 |
|
|
|
|
|
|
|
|
|
|
Gain on
sale of property, plant and equipment |
|
|
|
- |
|
|
1,018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes on income |
|
|
|
3,320 |
|
|
5,405 |
|
Income tax expense |
|
|
|
870 |
|
|
1,570 |
|
|
|
|
|
|
|
|
|
|
Net
income |
|
|
$ |
2,450 |
|
$ |
3,835 |
|
|
|
|
|
|
|
|
|
|
Weighted
average number of shares outstanding during the period |
|
|
|
|
|
(Basic) |
|
|
|
14,821,659 |
|
|
14,350,721 |
|
(Diluted) |
|
|
|
15,457,629 |
|
|
14,929,695 |
|
Per Share
Data: |
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
Net income |
|
|
$ |
0.17 |
|
$ |
0.27 |
|
Diluted |
|
|
|
|
|
|
|
|
Net income |
|
|
$ |
0.16 |
|
$ |
0.26 |
|
|
|
|
|
|
|
|
|
|
Cash dividends per common share |
|
|
$ |
0.0950 |
|
$ |
0.0875 |
|
|
|
|
|
|
|
|
|
|
|
|
SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES |
|
CONSOLIDATED BALANCE SHEETS |
|
(In thousands, except share and par value data) |
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, |
|
|
|
|
|
|
|
2018 |
|
December 31, |
|
|
|
|
|
(Unaudited) |
|
2017 |
|
CURRENT
ASSETS: |
|
|
|
|
|
|
Cash and cash equivalents |
|
|
$ |
10,442 |
|
$ |
8,130 |
|
|
Accounts receivable, less allowance for doubtful accounts
of $1,510 and $1,382, respectively |
|
|
|
48,275 |
|
|
50,569 |
|
|
Accounts receivable - other |
|
|
|
2,107 |
|
|
1,848 |
|
|
Inventories |
|
|
|
36,380 |
|
|
64,979 |
|
|
Contract assets |
|
|
|
47,098 |
|
|
- |
|
|
Prepaid expenses and other current assets |
|
|
10,005 |
|
|
11,011 |
|
|
TOTAL CURRENT ASSETS |
|
|
|
154,307 |
|
|
136,537 |
|
|
|
|
|
|
|
|
|
|
PROPERTY,
PLANT AND EQUIPMENT, NET |
|
|
27,033 |
|
|
26,844 |
|
|
OTHER
INTANGIBLE ASSETS, NET |
|
|
|
28,302 |
|
|
29,061 |
|
|
GOODWILL |
|
|
|
16,042 |
|
|
16,032 |
|
|
DEFERRED
INCOME TAXES |
|
|
|
215 |
|
|
2,900 |
|
|
OTHER
ASSETS |
|
|
|
9,180 |
|
|
7,564 |
|
|
|
|
|
$ |
235,079 |
|
$ |
218,938 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES: |
|
|
|
|
|
|
|
Accounts payable |
|
|
$ |
19,263 |
|
$ |
19,752 |
|
|
Other current liabilities |
|
|
|
9,375 |
|
|
12,409 |
|
|
Current portion of long-term debt |
|
|
|
6,000 |
|
|
6,000 |
|
|
Current portion of acquisition-related contingent
liabilities |
|
1,080 |
|
|
3,061 |
|
|
TOTAL CURRENT LIABILITIES |
|
|
|
35,718 |
|
|
41,222 |
|
|
|
|
|
|
|
|
|
|
LONG-TERM
DEBT |
|
|
|
39,949 |
|
|
32,933 |
|
|
LONG-TERM
PENSION LIABILITY |
|
|
|
8,133 |
|
|
8,319 |
|
|
LONG-TERM
ACQUISITION-RELATED CONTINGENT LIABILITIES |
|
7,469 |
|
|
7,283 |
|
|
OTHER
LONG-TERM LIABILITIES |
|
|
|
4,744 |
|
|
4,213 |
|
|
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 - 15,143,328 and 15,081,947, respectively. |
|
|
15 |
|
|
15 |
|
|
Additional paid-in capital |
|
|
|
50,626 |
|
|
49,103 |
|
|
Retained earnings |
|
|
|
95,296 |
|
|
83,129 |
|
|
Accumulated other comprehensive income (loss), net of tax: |
|
|
|
|
|
Pensions |
|
|
|
(7,066 |
) |
|
(7,282 |
) |
|
Cash flow
hedges |
|
|
|
50 |
|
|
(90 |
) |
|
Foreign
currency translation adjustment |
|
|
145 |
|
|
93 |
|
|
TOTAL
SHAREHOLDERS' EQUITY |
|
|
|
139,066 |
|
|
124,968 |
|
|
|
|
|
$ |
235,079 |
|
$ |
218,938 |
|
|
|
|
|
|
|
|
|
|
|
SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
THREE MONTHS ENDED MARCH 31, |
(Unaudited) |
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018 |
|
2017 |
|
|
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
Net income |
|
|
$ |
2,450 |
|
$ |
3,835 |
|
|
|
|
|
|
Adjustments to reconcile net income to net cash (used in)
provided by operating activities: |
|
|
|
|
Depreciation and amortization |
|
1,626 |
|
|
1,358 |
|
Provision for bad debts - accounts receivable |
|
157 |
|
|
146 |
|
Share-based compensation expense |
|
1,052 |
|
|
842 |
|
Deferred income tax provision (benefit) |
|
162 |
|
|
(320 |
) |
Gain on sale of property, plant and equipment |
|
- |
|
|
(1,018 |
) |
Change in fair value of acquisition-related contingent
liabilities |
|
209 |
|
|
44 |
|
|
|
|
|
|
|
|
Changes in assets and liabilities: |
|
|
|
|
Accounts receivable - trade |
|
2,147 |
|
|
7,164 |
|
Accounts receivable - other |
|
(259 |
) |
|
689 |
|
Contract assets |
|
|
(3,780 |
) |
|
- |
|
Inventories |
|
|
3,742 |
|
|
(1,078 |
) |
Prepaid expenses and other current assets |
|
27 |
|
|
(1,892 |
) |
Other assets |
|
|
(1,564 |
) |
|
(1,522 |
) |
Accounts payable and other current liabilities |
|
(7,132 |
) |
|
(1,016 |
) |
Long-term pension liability |
|
97 |
|
|
(920 |
) |
Other long-term liabilities |
|
450 |
|
|
696 |
|
Net cash (used in) provided by operating activities |
|
(616 |
) |
|
7,008 |
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
Additions to property, plant and equipment |
|
(1,055 |
) |
|
(930 |
) |
Proceeds from disposals of property, plant and equipment |
|
- |
|
|
2,808 |
|
Net cash (used in) provided by investing activities |
|
(1,055 |
) |
|
1,878 |
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
Proceeds from long-term debt |
|
31,657 |
|
|
71,209 |
|
Repayment of long-term debt |
|
(24,642 |
) |
|
(71,367 |
) |
Payment of cash dividends |
|
|
(1,402 |
) |
|
(1,231 |
) |
Payment of acquisition-related contingent liability |
|
(2,000 |
) |
|
(1,800 |
) |
Proceeds received on exercise of stock options |
|
257 |
|
|
105 |
|
Tax benefit from vesting of acquisition-related restricted
stock |
|
105 |
|
|
70 |
|
Tax withholding on exercise of stock rights |
|
(17 |
) |
|
(201 |
) |
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities |
|
3,958 |
|
|
(3,215 |
) |
|
|
|
|
|
|
|
Effect of currency exchange rates on cash |
|
25 |
|
|
52 |
|
|
|
|
|
|
|
|
Net increase in cash and cash equivalents |
|
2,312 |
|
|
5,723 |
|
|
|
|
|
|
|
|
Cash and cash equivalents balance, beginning of year |
|
8,130 |
|
|
3,649 |
|
|
|
|
|
|
|
|
Cash and cash equivalents balance, end of period |
$ |
10,442 |
|
$ |
9,372 |
|
|
|
|
|
|
|
|
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